The last few months have been phenomenal for cryptocurrencies especially Bitcoin. In December 2017, it successfully hit the $19,000 mark. The main reason that Bitcoin is highly popular is that it exists on infrastructure called blockchain. If you don’t know about blockchain, it is simply a public ledger which enables you to view transactions within the system. This ensures that everyone can view the ongoing transactions.
Another important factor to Bitcoin success is cryptocurrency mining. In fact, this is a tight-knit community of cryptocurrency miners that use high-powered computers to maintain the blockchain. In any cryptocurrency, it is essential that it has a strong community. This community will ensure that it provides feedback to the developing team and it helps maintain is the transactions within the blockchain. Typically, these miners will try to solve a difficult mathematical problem on the platform. The ones with the highest computing power that can solve the mathematical equation will be rewarded with a certain amount of Bitcoin is in return.
The importance of blockchain cannot be understated to the growth of Bitcoin. In fact, even if cryptocurrencies are not here to stay, blockchain will remain an important part of the future.
Industry specialists, serial entrepreneurs, and influential individuals have been talking continuously about the long-term implications of cryptocurrencies and decentralized systems. In a world that is largely dominated by institutions that have a regulated body to monitor the transactions, people want to break free from a system that they deem as broken. The presence of blockchain has made this possible.
Blockchain truly has some tangible uses that will significantly improve the innovations created by the blockchain start-ups. If you’ve never understood the fundamentals of blockchain and Bitcoin, there is no better time to do it than now. Hence, in this article, we are going to outline several reasons why you should care about the presence of blockchain and cryptocurrencies.
- Grab the opportunity to be an early adopter
If you haven’t noticed it yet, cryptocurrencies have not been around for too long. This means that they are still in the infancy stage. There are still a lot of things that the developing team needs to create to develop the potential of cryptocurrency and blockchain fully. The potential that the technology has is limitless. This can be compared to the earlier days of the Internet. There are still several critical components that need to be built before blockchain can become available to the mass public.
Start-ups must participate in its opportunity to develop this technology so that they can be the first mover in the industry and potentially reap the rewards in 10 to 20 years from now. Although it may seem difficult to come up with a unique creation using blockchain, being the first mover in the industry will help you establish a position within the industry when everything is saturated in the future. While there are already some companies dabbling in the blockchain community, it is not yet a saturated technology.
In short, start-ups must make their move now so that they can build a strong community around their invention before it becomes too crowded that people don’t even care about innovations. Now that the attention is on the blockchain world, cryptocurrency entrepreneurs should see this as an opportunity for them to push their ideas forward.
- Shifting to digital systems
Today, there are many start-ups which operate on outdated infrastructure. Businesses often have the mindset of doing things how they used to work before. People are also hesitant about replacing old technologies because shifting to a new technological structure would incur a lot of costs. However, the long-term cost of doing business using outdated systems is much higher. Investing in a digital system is very important as it will increase the efficiency of a system although there is a high initial cost. Furthermore, companies also need to analyze their competitive advantage to remain sustainable in this technological ecosystem.
As the aspects of most businesses are still manual, this means that organizations are still exposed to the risk of human error. That said, we are not suggesting to take out the human element from business completely. However, the presence of automated blockchain networks entirely shifts how the business functions. Ethereum is an example of a platform that offers smart contracts, which is the revolutionary feature of the blockchain.
Using the Ethereum platform, these smart contracts can be executed once certain conditions have been met. Therefore, there could be a future where we don’t need human beings to govern over transactions. In addition to this, the use of blockchain significantly reduces the transaction fees.
- Securing data
Regardless of the size of your company, cybersecurity is very important. Over the past few years, cybercrime has been increasing. In 2017 alone, cybercrime has caused the information security industry to spend nearly $90 billion. On top of that, the predicted spending for cybersecurity products and services is expected to exceed $1 trillion in the next few years. For companies who are shifting their operations online, having top-notch security is important. Given the high security associated with the use of the blockchain, it could be the default method to store and organize enterprise data.
Besides just being associated with cryptocurrencies, blockchain can also function as a storage of value. With blockchain, you have access to the latest cryptographic methods to protect all of your data. In addition, having access to the blockchain is highly difficult if you don’t have the necessary details. As blockchain system is a distributed system, meaning it cannot be manipulated by a powerful single entity. The consensus is required for decisions to be finalized on the blockchain. Therefore, no central authority is required to approve transactions.
Moving away from the speculative nature of cryptocurrencies, blockchain is making a name for itself within the investment community. This is even more so for banking institutions, government and also corporations that want to adopt the usage of blockchain into their infrastructure. In the future, we can enter into a peer-to-peer transaction system without the need of an intermediary for all of our online transactions.