Blockchain represents one of the most controversial technologies developed in the recent years. The main reason for the controversy is the fact that this tech has changed the way in which the internet can be used.
Moreover, it gave birth to cryptocurrencies which promise to completely revolutionize the financial world by replacing fiat currency in the future. As such, it should come as no surprise that blockchain is still a volatile investment strategy, especially since it is still in the early stages of its development.
Why is the crypto investing interest growing so fast?
First of all, let’s be clear about one thing. Cryptocurrencies and blockchain technology are not the same thing. Blockchain is a tech that allows data to be distributed on the internet, without being copied or tempered with. Cryptocurrency is just one of the applications of the blockchain technology, but it is the most popular application, and currently the most popular.
The main reason for the growing interest in crypto investing is the high return of investment. Since digital currencies threaten to replace fiat currencies, their value is constantly growing.
Moreover, due to the fact that these currencies are decentralized, they are a safer investment bet than repository assets. Crypto coins can’t be affected by inflation, by world events, or they are almost impossible to hack. The transparency of crypto coins is also a great incentive.
Blockchain applications in different industries
As we already mentioned, blockchain has numerous other applications in various industries, from tech, to healthcare, finances, education and much more. The tech itself is still developing, and most of the companies that use it don’t make high profits from it. However, if you have long term investment plans, it pays to bet your money on companies that already use the tech, and which have plans for making a profit with it in the future. The most common and most likely to profit applications of this tech are the following:
- Financial applications – In the financial sector, blockchain is already used in numerous ways. Nasdaq is experimenting with it to test a new system for trading securities of private companies. JPMorgan Chase is using it for an interbank payment platform. Barclays is using it to develop a back0occice bank operating system.
- Tech applications – In the tech world, blockchain has endless applications, but it is still in its developing stages. Spotify is using it for a digital rights management system to manage music copyright-attribution protocols. This tech could also be used to make IoT devices safer, by reducing the risk of the devices being compromised by servers or other single points of failure.
- User based platforms – The uprising user sharing industry can easily be decentralized, by using blockchain to eliminate the middleman. This can be used for platforms like Uber, Airbnb and many others like them.
- Low enforcement – Electronic voting has been debated for many years. However, up until now, there hasn’t been a safe way to develop such a system, without exposing the voting process to hacks, but this can and will be achieved with blockchain tech.
- Supply chain – Blockchain is successfully used in the supply network that supports data about products and all the parties involved in the trading process. It is a great way to provide transparency regarding the origin of the products, their ingredients and other valuable product information.
- Healthcare – In the healthcare industry, the most common challenges are data privacy and accessibility, which contributes to the lack of trust between doctors and patients. By implementing blockchain tech, patient records can be easily secured, all parties can have easy access to information, and payments can easily be processed in a private manner.
- Education – E-learning is promising to revolutionize the traditional educational system, empowering students with information that they can access in their own time, at any time, and from anywhere in the world. Blockchain can easily be used to support new education solutions that are currently facing technical difficulties.
- AI – The lure of artificial intelligence eliminates human error and to improve work productivity. Blockchain can be used in this industry to reduce costs, to increase the speed of transactions, to improve the security of AI based technologies, to reduce fraud and to reduce the risk of single points of failure or hacks.
Energy – blockchain can be used to provide a decentralized energy transfer and distribution system with the use of micro-transactions, validated and secured with cryptography.
- Legal – Contracts can easily be stored on blockchains, with different parties having easy access to them. The contracts can also be transferred or modified without direct legal intervention.
Crypto hedge funds for beginner investors
Despite the fact that crypto hedge funds have seen plunging returns in the first semester of this year, the interest of the investors in these funds continues to be growing. The lure of massive overnight returns is simply too tempting to pass, and with a proper risk-management system, investors can safely bet their money on blockchain.
Aside from the promise of exorbitant returns, a blockchain hedge fund is a safe investment option, as it allows investors to build a diverse portfolio without actually holding the digital currency. Last but not least, hedge funds can use different investment strategies. While some only focus on Bitcoin, others choose to focus on Initial Coin Offerings, while others hold a diverse portfolio of cryptocurrencies.
The funds with the safest strategies are those that invest in companies that use blockchain tech, but this strategy is best suited for investors who are willing to wait for long term returns.
The beauty of hedge funds is that they are ideal for beginner investors, or for investors that don’t yet fully understand the blockchain tech. By working with a hedge fund, you will benefit from advice from experts that fully understand this tech and its applications, and who have access to sophisticated research and risk management tools. This way, investors are guided towards the safest and most efficient ways of achieving their investment goals.
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