The Recent Increased Interest In Blockchain And Cryptocurrency Technologies Will Have A Positive Long Term Impact That Is Much Greater Than The Short Term Behavior Of The Market.
It's very easy to begin to become discouraged in a downward market like we are currently seeing, but just keep in mind how much cryptocurrencies have advanced over the past year.
Interest in blockchain technology around the globe is at the highest level that it has ever been, and in my opinion that increased interest in blockchain will have a bigger impact on its long term success compared to any specific period of market conditions. The recent Bitcoin price run brought Bitcoin into the mainstream in a positive way, which has been relatively rare in Bitcoin's past. Individuals are beginning to look into Bitcoin more than ever before, and many of these new users will likely stick around and learn about the rest of the market as well. Firms and big investors are finally beginning to take note of how big the implications of blockchain technology are, and are investing at a higher level than ever seen before.
While the current market simply couldn't absorb the huge amount of additional investment in such a short time, the level of investment shows me that firms and investors are ready to get on board, but the market currently is not ready. While Bitcoin held its gains over the past months very well, at some point the sell motivation simply gets too large and the market reverses into a retreat. While this volatility and quick price retreat are not good for instilling faith in Bitcoin skeptics, investors and firms that did proper research and took proper precautions realized that this type of retreat was entirely possible. While Bitcoin and some alt-coins will likely loose some of there support in the short term, the high level investors are likely not going to abandon the market and are likely to even invest venture capital into new cryptocurrency projects and startups.
Venture capital being invested into upcoming projects will likely be more beneficial for the advancement and development of blockchain technology compared to investing into a cryptocurrency position directly. There are some great cryptocurrency and blockchain projects in existence currently, but over the following months we may see projects that are truly game-changers. The reason that I think it is likely that we will see numerous very promising projects is because institutional interest and institutional capital really began to come to the cryptocurrency market back at the beginning of this year, and has been rapidly increasing over 2017 so far. It is very probable that numerous firms have invested significant amounts of venture capital into upcoming projects, and many firms have likely began to develop or look into implementing a blockchain system of their own.
A project can get much better 'results' from a smaller direct investment compared to an increase in the price level of its token.
When a project's coin or cryptocurrency goes up in price level, the development team is able to spend more on development and other expenses which will likely increase the speed of development. While this is definitely very helpful for the project, the level of investment needed to increase the price level is significantly greater than the level that would need to be invested directly in the project to achieve the same results. A one million dollar investment into a new cryptocurrency project will likely be extremely helpful in significantly increasing development speed and quality, and will often leave the investor with a larger stake than they would have from investing into the cryptocurrency once it is available for sale on exchanges. While most of us probably have no means to invest in any venture capital into projects directly, it is still very promising for the development of future projects.
A new project must be careful when originally dispensing the supply of its tokens, and must ensure that early investors are not able to achieve a vastly disproportionate stake. Unlike traditional startup companies or firms, cryptocurrency projects cannot give away 10-50% stakes in their projects like new startups often do. This means that venture capital investors must be confident in the project that they are investing in, but also they must acknowledge that a even just a 1% stake in a project can be astronomical if the project is able to see mainstream adoption and success.
Support may be pulled from current coins and markets, but mainstream firms and businesses are finally accepting and interested in blockchain technology.
Traders and investors may exit the market until conditions improve, but there is no doubt that there is money waiting for a project as soon as it can handle it. If a project emerges with serious practical use cases and potential, the likelihood that it could be funded sufficiently is astronomical. Investors have serious capital that is simply waiting to be invested, but the project must be promising enough to support the level of investment that it receives. All of the big banking and technology firms are experimenting with blockchain technology or offering blockchain services, which seem to also be gaining significant interest and momentum.
Steemit is looking more promising than ever in my opinion, and I believe that we will continue to see a consistent increase in user base over the months to come. As more and more individuals are initially learning about Bitcoin and blockchain technology, more individuals will likely come across Steemit or Steem. Most individual's first experiences with blockchain and cryptocurrency technology was Bitcoin, but individuals commonly venture into the cryptocurrency market as a whole after some time. As more users begin to gain interest in blockchain technology, Steemit is one of the only projects in existence where users can see a 'tangible' version of the blockchain, as well as get great cryptocurrency information and news on the platform. I truly think that the blockchain revolution is right around the corner, and will be here before many people expected.
I really hope that you enjoyed this post and as always I urge you to leave any comments, questions, input, ect. in the comments below! Thanks for reading!
