Like many other crypto junkies I go several times a day to coinmarketcap.com to check the stats and prices. Today the total market cap of all cryptos had reached 100 billion US Dollars:
That's a good reason to celebrate and to reason about the future of cryptos.
Party like it's 1999
Is there somebody around that is remembering the dot.com-boom in the late 1990s? The NASDAQ chart in 1999 looked like the coin market cap chart of 2017:
(Source: coinmarketcap.com)
Some will say, that crypto is another bubble that will burst soon. But I disagree, and this is why:
1. Crypto is a new asset class
There's a intriguing graphical comparison of all asset classes at VisualCapitalist.com. Here is an excerpt from it with some common assets for investing.
(Source: VisualCapitalist.com, Note: The market value statistics for Silver, Gold and the Stock Market are from 2015. So they are slightly higher now. But you get the picture.)
Did you still think that a market cap of 100 billion USD is huge if you compare it to other asset classes in a global scale? A German business magazine has recently called Bitcoin the new Gold. All the gold above ground in the world has a worth of 7.8 trillion USD. That's nearly 800 times the worth of all cryptos. There seem to be much potential for future rising of coin prices.
2. Crypto is transforming business
But crypto is not only "electronic gold", it's a new way for making business. There are many really good articles about the decentralization of the economy with blockchain. But crypto is not only a business model - like SIA for cloud storage - it's much more.
Crypto is a new way to raise capital. The recent ICO for the Brave browser was a very impressive demonstration, how crypto can beat the stock markets as a tool for raising capital. Brendan Eich, the former CEO of Mozilla, had raised 35 million USD in 30 seconds. And, not to forget, with nearly no transaction costs. That could disrupt the business models of many investment banks very badly.
(Source: Techcrunch.com)
Crypto is a new way to create a community. Steemit is good example. The value of STEEM is the equivalent of the combined attention and wisdom of all the Steemians. There is simply no better way to create a community by giving every member a share in it, based on his level of his active and passive participation. Creativity and attention have a market value. Nobody knows that better that Mark Zuckerberg of Facebook. Guess where his billions are coming from. He is selling the creativity and attention of all the Facebook users. A a true capitalist I am not mad about this. Mark Zuckerberg deserves all the billions that he owns. But I'm really sure, that Facebook will getting disrupted soon by blockchain solutions. (Or, it will disrupt itself, when the company is smart.)
It's not hard to imagine, that this kind of community building by issuing crypto token is not only useful for social networks or social news websites. Every company can use it to buy attention for its own products. (Many already doing it now very poorly with discount coupons and other incentives.)
Crypto is a new way of managing a business. The VC William Mougayar said in a recent Unchained podcast at Forbes, that many companies in the future will have their own crypto based currencies: “If you have your own currency, you have your own governance, so each currency becomes their own mini-government. Mini-government a big word, but it’s a body that is governed in a decentralized manner where users have a say, where there’s oversight and transparency.”
The other guest in this podcast, the TokenSummit Co-host Nick Tomaino, added that many businesses in the future will not be a company anymore: “People call them companies, and the analog in the traditional world is a company, but they’re really not companies. I think it’s best to think of them as decentralized autonomous organizations where there’s an entrepreneur and founding team but no legal entity … I really think of these structures as internet tribes. … They’re collections of people from all over the world that own a token and have ownership in a product and want to bring a token to the world.”
There were only three aspects how blockchain based cryptos will transforming the way of doing business. There are many more.
3. Some new crypto giants will emerge
The total market cap of all crypto currencies will reach 100 billion US Dollars soon. That's huge. But remember that Apple Inc. alone has now a market capitalization of 800 billion US Dollars. Is it far fetching to think, that one not so far day in the future one crypto based company will be as large as Apple? Even Apple had started very small with two guys in a garage. Let's imagine what could grow out of the garage of these two guys:
(Source: Internet)
With some future crypto company giants in mind, the 100 billion US Dollar market cap seems very reasonable. But of course not all the cryptos will survive. The laws of capitalism are working in the crypto sphere like everywhere else.
If you have a guess, what coin will become the next giant, please tell us in the comments. (It will make us rich.)
4. Crypto brings value to underdeveloped markets
One of the best things of crypto is, that it's leveling the ground. It doesn't matter if you are sitting in Silicon Valley, Tokyo or in a small village in central Africa. If you have internet connection, a computer and some knowledge you can start your own crypto business very easily. You don't need huge investment capital or expensive hardware.
But that's not all. The developed countries in Europe, North America and Asia have many institutions that are creating trust in their societies. Think of a register of real estate. When you want to buy real estate in a developed country you can look-up online the rightful owner of this piece of land. In most underdeveloped countries there is nothing like this. One of the reasons is that there is a lack of trust for the state institutions because of corruption. With blockchain you can create such a trusted register with ease.
Another problem of underdeveloped countries is the lacking of a functional financial system. Thanks to mobile based solutions, everyone in Africa who owns a cell phone can now make money transfers very easily. Blockchain based Crypto currencies can make these transactions much faster, cheaper and more secure.
Of course there are much more benefits that blockchain technology can bring to underdeveloped countries. They will help some billion people to improve their economies an get better access to the global market.
And all of this will fuel the crypto market as well, which will lead us to one trillion US Dollars coin market capitalization.
