As you read this, Telegram (one of the world’s largest instant messaging platforms) is in the process of raising over $1 billion in investment through something called an initial coin offering (ICO). Rather than opt for venture-backed financing or offer the public an ability to purchase shares via a traditional initial public offering (IPO), Telegram is using blockchain technology to revolutionize how business is funded.
Blockchain technology is quickly changing the way the world does business, from raising capital to managing data to monitoring logistics. For those unfamiliar with the term, think of blockchain as a highly advanced spreadsheet. This database is totally decentralized, the same information lives on individual computers and is updated in real-time.
When data is entered into one cell, the blockchain network uses advanced encryption to ensure that the data is added and cannot be tampered with across all of the distributed databases. Thanks to blockchain technology, decentralized and secure databases are possible. That means innovation can occur without needing to enlist the help of large conglomerate middlemen. From internet service providers to banks, blockchain is helping companies to innovate faster and more efficiently than ever before.
This article will review a few exciting blockchain technologies that every entrepreneur should know about.
Most readers are likely already familiar with popular cryptocurrencies like Bitcoin and Etherium. While these cryptocurrencies are well-known for good reason, there are some drawbacks associated with them as well.
For one thing, these currencies are volatile. For example, the value of one Bitcoin has dropped by roughly $10,000 in the past two months. In December, Bitcoin was valued at an all-time high; today, it is hovering around the $9,000 mark. Such volatility causes mainstream investors like JP Morgan to steer clear of cryptocurrency, slowing the adoption of a potentially revolutionary financial development.
But other companies, like TrustToken, are working on an alternative currency that promises to be less volatile. Trucoin is linked to fiat currencies (government-backed currencies like the United States Dollar or the Great British Pound). As a result, the value of Truecoin is far more stable, and thus more attractive to institutions.
In time, entrepreneurs who are interested in wisely investing their money should consider examining fiat backed cryptocurrencies since they may offer more protection than other options.
2. User controlled dataThe average consumer has little control over his or her data, large companies like Google collection millions upon millions of data points about user behavior each day. In fact, one study cited in Curious Insight estimates that Google stores roughly 30 million personal computers worth of data.
In some locations, like the European Union, government agencies are attempting to regulate what data can and cannot be collected without a consumer’s consent in the form of GDPR. But thanks to blockchain technology, consumers may have more power over their data than ever before.
Using blockchain technology companies like Wibson are building tools that put the consumer in the driver’s seat. Instead of having data mined with the user’s passive consent, Wibson allows users to sell their personal data to tech companies and advertisers. In exchange for sharing personal data, users receive a form of cryptocurrency.
This new model would have serious implications on how tech companies operate; it would mean organizations have less access to user data for free. On the other hand, it may enable smaller companies that ordinarily have small data sets to quickly gather valuable data simply by paying users a nominal fee.
Loans can be a tricky business; surely, the average law school student has had to deal with exorbitant student loans in order to simply obtain a degree. Similarly, many entrepreneurs have been forced to secure a balance transfer credit card to pay off excessive debt incurred as a result of investing in a new business.
Thanks to blockchain technology, entrepreneurs may soon have to new types of financing options. Cryptocurrency owners who are interested in instantly exchanging coins for dollars should consider a new platform called Salt.
Salt operates as a lending marketplace; coin owners who are interested in accessing a more liquid asset like cash can find lenders who are willing to exchange cash for cryptocurrency. Once the loan and any interest associated with the loan is paid off, the lender releases the coins back to the borrower.
While cryptocurrency tends to receive the brunt of the hype, blockchain is arguably the more exciting technology. It is powering a movement of secure decentralization that is changing the world of finance, and data.
What blockchain technologies are you most excited about? Let us know by leaving a comment below!