Bitcoin frequently takes center stage in financial news, captivating investors with its erratic price swings and potential for appreciation. However, blockchain, the database technology that underpins cryptocurrency, is receiving much less attention.
An electronic ledger is comparable to a blockchain. It has the much-celebrated feature of permanence in that data can be entered into it, but it cannot be changed or deleted (and implied integrity).
Since the initial blockchain that enabled the launch of bitcoin in January 2009, numerous others have arisen. While some blockchains support multipurpose digital platforms like Ethereum that function like decentralized variations of more conventional (i.e., centralized) platforms and networks, others support cryptocurrencies like bitcoin.
Over the past few years, investing in blockchain technology has gained popularity. Additionally, there are many options because blockchain technology isn’t just relevant to cryptocurrencies. Furthermore, it includes
Businesses that provide services related to cryptocurrencies (such as crypto-exchanges, where you trade currencies)
Firms who are developing their blockchains for use in other industrial or commercial applications
Benefits of Investing in Blockchain Technology
Blockchain technology has become a desirable investment opportunity due to the expected trust, transparency, and efficiency improvements. Numerous industries can benefit from using blockchain, and those who do so will have a competitive advantage over their rivals.
“By using blockchain, organizations may increase trust and transparency in areas like the origin of drugs, food components, or parts. Additionally, solutions that enable business dealings, the issue and trading of securities, and cross-border payments can be developed, “Jones argues.
In their Time for Trust research, PwC’s economists predicted blockchain technology might increase global GDP by $1.76 trillion over the next 10 years. Therefore, it makes sense that investors would be interested in those top businesses that can provide the most blockchain-related services.
Simply said, blockchain technology may increase profits by lowering expenses for businesses. More enormous revenues would undoubtedly increase their stock shares and the portfolios of investors who invested early.
They don’t have to be technical plays, though. In a broader sense, blockchain investments can also include holding stock in cryptocurrency-focused businesses (like Square, a cryptocurrency payment platform) and firms that have made bitcoin investments (such as MicroStrategy).
They are more likely to increase in association with bitcoin prices because the operation of these businesses depends on the performance of cryptocurrency prices. Additionally, given that bitcoin has risen by about 300 percent over the past year, investors who favor fast-growing companies may be attracted to them.
Steps For Investing In Blockchain
Depending on your investment preferences and financial capabilities, there are various methods to invest in and profit from blockchain technology. Here are several ways to invest in the industry.
Non-Fungible Tokens( NFTs)
Digital assets that have been tokenized are known as non-fungible tokens (NFTs). They already existed before 2021, but the sale of a collage of non-fungible tokens by digital artist Beeple for $69 million brought them to the public’s notice. Any digital asset, including apparel, artwork, music, movies, video games, and other media that can be tokenized, can be an NFT.
Cryptocurrency And Digital Assets
One of the easiest ways to invest in blockchain technology is also one of the most popular. You only need to create a trading account on the cryptocurrency exchange platform of your choice to get started trading. Due to cryptocurrencies’ extreme volatility, this investment carries a high level of risk.
Blockchain has made it possible to tokenize anything, including gold, real estate, and works of art. Tokenization is the process of turning anything valuable into a blockchain-based digital token. Fractional ownership is possible through tokenization. If you’re a real estate investor, you can’t buy a $2 million property; the property manager or owner may tokenize it.
By preserving ownership proof, blockchain ensures the security of your ownership share. You can do this to grow your investment portfolio at a reasonable rate.
Angel Funding and Blockchain Startups
While the idea of angel investment has been around for some time, investing in is relatively new. Angel investors are a viable source of finance for blockchain firms that haven’t yet made it to the public offering stage. Angel investors consider blockchain business ideas, assess their viability, and provide funding in exchange for company stock.
Being a startup provider for an enterprise blockchain app development company puts you at the forefront of what might be the next big thing. However, you must carefully examine both the concept and the owners because some firms fail to live up to their promises and fail. Market disruptors that grow into high-value businesses are typically the ones that are successful and provide a decent return on your investment.
Stocks of Companies Using Blockchain Technology
When it comes to firms using or working with blockchain technology, some of the most prominent publicly traded companies include:
- IBM (offers blockchain services)
- Amazon (offers Amazon Managed Blockchain service)
- Intel (offers blockchain services)
- Nvidia (sells GPUs to cryptocurrency miners)
- AMD (sells GPUs to cryptocurrency miners)
- Mastercard (working on blockchain-based cross-border payments with R3)
- Honeywell (using blockchain to track sales)
- DocuSign (offers blockchain service)
- JPMorgan (created its own cryptocurrency, JPM Coin, and its own unit for blockchain projects)
- Canaan (manufactures mining hardware)
- Silvergate (offers banking services to blockchain and cryptocurrency firms)
Processing And Accepting Cryptocurrency For Payment
A great alternative to taking fiat money is to accept cryptocurrencies as payment. To ease worries about security, you can accept it in addition to debit and credit card payments as a form of payment in your company. In addition to potentially growing your consumer base, you will earn cryptocurrency.
You can gain from price changes by accepting cryptocurrencies. But you also need a cryptocurrency payment gateway that automatically calculates and converts fiat values to cryptocurrency equivalents. Additionally, creating a cryptocurrency payment solution and making it available to other companies is an excellent opportunity to invest in and earn money with blockchain.
Metaverse Development Firms
One of the more challenging blockchain concepts to comprehend is the metaverse. The metaverse is an ever-present and developing a digital environment where reality, augmented reality, and virtual reality collide. The idea is to create a fully immersive digital environment where people may learn, work, play, and interact.
The hardware and software required for this digital life experience are being developed by social networking platforms, game developers, and technology firms. Some businesses interested in metaverse goods and services include Meta (previously Facebook), Advanced Microdevices (AMD), Nvidia, Amazon, and Electronic Arts are some examples of metaverse development company in USA . As the metaverse expands, blockchain will play a significant role.
Takeaway
Blockchain technology is a fascinating area of innovation that extends across many different industries. Investors worldwide are intrigued by its potential since it holds forth the promise of further growth.
Cryptocurrencies like bitcoin, whose price has increased by 300 percent in only 2020, have also sparked interest in blockchain technology.
This is why anyone looking to invest in “blockchain tech” should focus less on companies that only use blockchain and more on those who offer cryptocurrency services or invest in cryptocurrency.
Nevertheless, because blockchain ETFs invest in a broader variety of businesses, they may be a better option than buying shares of certain blockchain-related companies.
