Crypto And Blockchain Space – The year 2020 saw Cryptocurrencies rise in popularity, demand, and value. Everyone wanted to get their hands on Bitcoin, Ethereum, Dogecoin, and other cryptocurrencies.
If 2020 was the start of the hysteria, 2021 saw the same being institutionalized. Cryptocurrencies and Blockchain technology no longer remained attractive for only computer nerds and stay-at-home moms.
It became something much bigger than garnered the attention of the right and mighty from Silicon Valley and Wall Street. Tech companies started increasingly engaging with both cryptocurrencies and blockchain aggressively.
In this resource article, we are going to look at some reasons why tech companies have taken to crypto and blockchain as a fish takes to water!
List of 5 Reasons why Tech Companies are Entering the Crypto and Blockchain Ecosystem
Reason 1: The Founders and CEO see promise
The first major reason is that the founders of tech companies realize that this is a disruptive entity that has the potential for changing the world. Whether it is Twitter’s Jack Dorsey or Facebooks’ Mark Zuckerberg, all of them believe that Blockchain and Digital Currencies have major implications for the coming years. This is why they are willing to invest billions.
Reason 2: Increasing Customer Demand for Cryptocurrency Acceptance-
Think about the target audience for a brand like Tesla. They are environmentally conscious, promote sustainability, and are against corporate hegemonies. They are smart, young, educated professionals that want to establish an egalitarian order. Naturally, Tesla’s consumer base is drawn to cryptocurrencies, forcing the brand to take proactive steps in that regard.
Reason 3: The Crypto and Blockchain Infrastructure and Support System has grown-
There is no denying the fact that in just a decade’s worth of time, cryptocurrencies and blockchain technology have made rapid progress. Most of the big financial institutions have already started offering designated crypto services. This has made it possible for tech companies to start exploring mainstream avenues of investment and engagement.
Reason 4: Pro-active Governmental Regulations and Legalizations
If you are a major tech company in Silicon Valley that has shareholders, you would not want to be part of anything sketchy. This is why one major reason why tech companies are aggressively investing in cryptocurrencies and blockchain is because of positive governmental legislation. The tax structure is relaxed and more progress is expected in the future.
Reason 5: The Market Logic of Profit that is loved by Boards and Shareholders
At the end of the day, tech companies are businesses that are interested in financial profits. Given the high growth and valuations in cryptocurrencies over the last few years, it is but natural for them to look at it in terms of investments. This is much the same way they would invest in employees, new corporate offices, or software development. The return is there.
From financial companies like Visa, Mastercard, and JP Morgan to Social Media Giants like Facebook, Twitter, Telegram, and Baidu, everyone is exploring and investing in it. Normal individuals are using the bitcoin revolution login to earn handsomely through trading and investing.
Is the Advent of Tech Companies in the Crypto and Blockchain Space Good News?
This is a question that has divided opinions on either end of the spectrum. Let us look at some of the positives that are enumerated by proponents that feel that this is a good thing-
- The advent of tech companies means that these businesses are picking up huge stakes and investing billions. Given how entrepreneurial they are, it means that further development in this space is a definite yes.
- The more established brands join the fray, the more difficult it becomes for governments to outlaw cryptocurrencies. For retail and normal investors, this is good news and the fear around bans ceases to exist.
- Experts also point out that institutional investors like tech companies can help bring maturity and reduce volatility. Price fluctuations and the volatile nature of cryptocurrencies are something that is often attacked as a major criticism.
- Tech companies and enterprising start-ups are now looking to evolve new business models using Blockchain technology. This is likely to revolutionize existing business models and improve their efficiency, profitability, and safety.
- Tech companies are famous for extending reach and penetration in places that might not have formal structures even. Governments and central banks can use their expertise to innovate on CBDCs and other technologies pertaining to Blockchain.
The Bottom Line
In the last few years, Cryptocurrencies and Blockchain have captured the attention of CEOs and Founders of tech companies. In fact, for many, this has become their next big project. There is no doubt that in the coming years, this engagement is going to skyrocket. With Dorsey already investing billions in his crypto venture, Square and Zuckerberg trying again after Libra’s failure, watch out for the next big innovations coming out of Silicon Valley.
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