A decade ago the Bitcoin was thought of as just some nerdy computer science project. But since it has come centerstage, saying it has gained substantial attention would be an understatement. Institutions were in panic at figuring out how a potentially market altering phenom could affect their status. This is because of the massive disrupting potential of cryptocurrencies that could shake the structural integrity of the industry at its very core.
Just as much as Bitcoin, the technology behind it, the blockchain, would command the same attention. As it was becoming evident that cryptocurrencies will not be going away soon, companies put their respective technical teams to the task. How would they make blockchain work for them? This inspired firms to put their sensitive resources into the blockchain. The intent was to take advantage of the almost impenetrable nature of a decentralized ledger that blockchain provides. And soon enough, the creation of blockchain investment fund was in full order.
The blockchain is basically a public ledger. It records transactions as per a normal ledger and replicates this data across multiple locations or nodes. And the nodes continuously verify each other in a synchronized manner. This makes it virtually impossible to hack. Changing a single bit of data in the blockchain requires changing that same bit across all the nodes. And that is still not mentioning the top of the line encryption that the hacker would have to go through.
As in each pitch in a Shark Tank episode, investment of any kind would come with deep scrutiny. And an extremely complex product would take a very convincing presentation for any shark to bite. But how is this for a pitch – the blockchain investment fund, is the key to an eye watering $85 trillion fund market. They can choose to pass and miss on the opportunity, of learn about the technology so they can understand for themselves the potentially massive value that the fund can provide.
Risk is a part of investments regardless of where or whom you invest in. But one thing is for sure, any personal attachment to a project is detrimental. An emotionally charged buying and selling spree would spell the end of any business. Thus the need for a service to take charge of their investments for them. Cryptocurrency is a booming business. One pops up all the time throughout a business cycle in an almost regular interval. This adds menace to an already convoluted market. Thus making it impossible for an individual to make an intelligent choice in the scenario. It is especially if they are inexperienced and that cryptocurrency is the only reason that drove them to investing in the first place. This risk is eliminated when investing in a blockchain investment fund.
The preliminary observations with regards to token generation events have largely been positive. In a matter of weeks, the investments have jumped ten to a hundred times in value. These events are the most accessible straightforward way to take advantage of the blockchain technology. However, despite the huge returns, it is also considered the most risky.
A few years later though, as the market began to stabilize with bigger chunks of the crypto technology being revealed, the value of the rogue assets has finally dropped. Meaning the ridiculous returns are gone. Some investors have lost everything in their possession. On a brighter note however, the Bitcoin has a history of rising up in value after being declared worthless, almost like a zombie asset that refuses to die.
Funding for a blockchain based project requires the investor to research on the potential investment. A main part of this is knowing what the company does and this should be that most obvious one. Unravelling more unknowns as an investor scratches deeper than the surface should be a red flag. Another is that the company should know what they want. This means that the company has a vision and won’t be swayed away from that direction for at least as long as until investments are returned. This are all necessary in knowing how a blockchain implementation will work for them. WIll it add to their value, or will it be a self imposed limitation. Due diligence is required to ensure that one’s investment is in safe hands.
One may also decide to invest in an alternative fashion that still ultimately takes advantage of the blockchain. One pet peeve of potential cryptocurrency investors is knowing that cryptocurrency do not have a solid asset to fall back on. This is the reason why it is a zombie asset as mentioned earlier. But if the crypto tokens were backed by tangible assets that anyone can appreciate like real state, art, gold, or any other actual state backed currency, the confidence in investing in the blockchain would heighten. These funds are often led by enthusiastic seasoned managers who have deep devotion to the cryptocurrency industry. This is an insurance that the ones holding your money are level headed and not just bobbing at the insanity surrounding the crypto industry.
Prominent cryptocurrency investment outlets demand that you exchange your money first into the digital currency you are investing in. This puts off some investors because they will actively be trading their cash for an asset whose value and liquidity are huge question marks. But through investing indirectly at the currency and investing at the blockchain instead, they wouldn’t have to see their money turn into ones and zeroes. This is where blockchain investment pops up. Blockchain has more use than just hosting cryptocurrency. It is a remarkable technology in itself. The ability to span the world for securely storing data is an astonishing feat. This is the ability that makes blockchain a valuable technology equalling or even surpassing the cryptocurrency.
Blockchain is the latest offering of the computer savants that continue to shape the world. It was once Babbage with the inception of the idea to mechanize numbers. Then came von Neumann who built the foundations of the modern computer. There have been many that have come since then. And now joining those ranks is Satoshi Nakamoto, the aptly unknown individual or group of individuals responsible for the blockchain. They would be leading the world towards a future that enshrines the right to privacy.