Bitcoin investors have been enjoying an incredible year, to say the least…
And those who missed out must endure watching their counterparts’ bubbling and volatile success from the sideline — much to their chagrin.
Just over a year ago, the price for one unit of the notorious cryptocurrency stood just over $600.
As I’m writing this, one bitcoin is trading for around $16,650, after dipping slightly from its all-time high of well over $17,700.
Still, it’s reached triple-digit gains within just one year. Truly incredible!
Sure, Bitcoin is absolutely everywhere these days, but it’s also getting much harder to ignore the successful technology behind the cryptocurrency…
Blockchain is on the rise, too, particularly since more banks and financial institutions are adopting the technology much faster than originally anticipated.
Case in point: IBM (NYSE: IBM) released a report in 2016 suggesting that 15% of all banks would be using the technology by 2017. By 2020, the firm states that nearly 70% of all banks would have blockchain in some sort of commercial capacity.
On a broader scale, a MarketsandMarkets report states that the size of the blockchain technology market will be worth 2.3 billion by 2021, increasing at a compound annual growth rate of 61.5%.
In other, more exciting words: There’s plenty of opportunities for investors to benefit from this explosive and expanding market without having to dabble in confusing cryptocurrencies.
Investing in blockchain technology usually occurs on platforms that most investors are more familiar and comfortable with.
There are many blockchain startups in their infancy looking for crowdfunding to get off the ground. A platform called BnkToTheFuture allows investors to place their money into several blockchain startups.
Another possibility is to invest in the initial coin offerings (ICOs) of new blockchain projects. Blockchain companies issue new cryptocurrencies and other tokens through ICOs in order to raise some much-needed capital.
There’s a bit more risk through this route because this new form of crowdfunding is still fairly unregulated, but the returns reported thus far have been stellar.
Let’s dive into this farther…
Blockchain Startup Stocks
Investors may easily purchase blockchain startup stocks. There are several publicly traded stocks in blockchain companies that are trading on an array of global exchanges.
The first blockchain-focused public company to start trading in the U.S. was BTCS Inc. (OTC: BTCS). This company provides an online Bitcoin shop and a range of blockchain solutions, making it a solid entry point for blockchain investors.
The company describes itself as an “early mover” in the digital currency ecosystems sector. The company’s CEO, Charles Allen, was interviewed by Bloomberg and explained that the company’s mission is to “gather a currency that can be spent on goods and services,” using Bitcoin to buy products like televisions.
Another prominent North American stock is the Vancouver-based blockchain consultancy service provider BTL Group (TSX: BTL), which recently launched its own smart contract and money-transfer platform by using distributed ledger technology called Interbit.
The company’s blockchain solutions spread across many industries — from banks to energy and even to energy sports — and its stock is traded on the Toronto stock exchange.
Outside of North America, there are also listed blockchain stocks in the U.K. and Australia.
In the U.K., the London-based blockchain technology investment and development company Coinsilium Group Limited (OTC: CINGF) was the world’s first IPO by a blockchain startup.
Coinsilium is relatively new in the blockchain field and has been actively involved in “accelerating seed-stage blockchain tech ventures” since 2014, according to its website. Since then, the company has gained massive interest from other blockchain companies, such as Factom, RSK Labs, Minebox, and Indorse.
In Australia, there’s the blockchain startup DigitalX Limited (OTC: DGGXF), which provides two blockchain-based services: a global peer-to-peer remittance service called AirPocket and a software solution to providing Bitcoin liquidity to institutional investors called DigitalX Direct.
Its mobile product AirPocket provides consumers with secure cross-border payments and remittances from over 30,000 payout locations in 14 countries, with a heavy presence in North America and South America.
ICOs
ICOs are a new and innovative way of raising capital that involves blockchain projects issuing their own digital currencies or tokens to early backers during a “crowdsale.”
Crowdfunding through ICOs is designed to raise initial capital quickly. Coins are pre-mined and then sold for capital, which is then reinvested by the company into their project.
Once the project is active and deemed successful, the value of the presold tokens may increase. From that point on, investors may either sell their tokens for profit or use them to take advantage of services being offered.
While ICOs may be considered a high-risk investment due to their current lack of regulation, if successful, investment yield could be considerable.
When it comes to investing in ICOs, the key is to research thoroughly and to select blockchain projects that will have real-life applications and are managed by a team of experienced blockchain developers.
Some early projects might even have financial backing from leading Bitcoin investors, which is usually a very good sign.
Unfortunately, the more the ICO market grows, the more fraudulent activity increases along with it. So, it’s vital to conduct thorough due diligence on each ICO before investing in the crowdsale to avoid falling victim to a scam…
Back-End Blockchain Infrastructure
A safer and more comfortable method of investing in blockchain growth is through companies that are the back-end leaders.
Several of the household name technology companies have already moved into this area. They include Microsoft (NASDAQ: MSFT) with its Azure cloud platform, IBM (NYSE: IBM) with its own IBM Blockchain as a public cloud service, and Amazon (NASDAQ: AMZN) with its Amazon Web Services (AWS) — a blockchain project partnered with the Digital Currency Group…
The Bottom Line
For a few years now, blockchain and cryptocurrency have gone hand in hand. But the idea of blockchain isn’t limited to the infancy of the cryptocurrency revolution.
Massive worldwide corporations are beginning to incorporate blockchain technology into their systems. In no time at all, we should see blockchain powering cybersecurity, secure elections and voting, transaction-based real estate, analytics, and so on…
While still being a relatively new technology, blockchain is poised to become one of the most useful and disruptive technological innovations of the 21st century.
With massive corporations already incorporating blockchain into their systems and hundreds of chain-centric startups pushing into the mainstream, the potential use of this cryptographic process is unfathomable.
And without you knowing it, this technology might already be part of your everyday life.
And this is only the beginning…
That’s all for now.
Until next time,
John Peterson
Pro Trader Today