Financial Giants VS Cryptocurrency Exchanges: who will be the leader of Blockchain in Financial Services?
【Published by Bi Shi Jie.】
Summary: as a new trend in financial industry, the operational logic of blockchain finance are remain unchanged. Correctly understanding the emergence and development of blockchain finance can improve our mind.
In a fast-growing market like China, financial technology improves every day, new developments are constantly infiltrating their lives. Since 2015, blockchain technology finally attracts extensive attention. At the time, people who know “blockchain” is through the booming of Bitcoin, but also can be sees as an opportunity to let people learn Bitcoin underlying technology which is blockchain technology.
Blockchain also known as a ledger, transaction information is continuously recorded securely on the “chain”.
Blockchain technology can become on of the core technology of financial technology, because it is a technological revolution with great potential in the financial industry. It also can see as a social trend of thought, which indicates the transformation of human society and the arrival of a new era.
In recent years, Europe and the United States have passed the concept of financial technology to China. The unstoppable wave has triggered a hot spot in China’s financial innovation. In terms of blockchain technology applications, although technology companies have first-mover advantages, financial institutions have no barriers in applying such technology. Technology logic and business logic must be combined to create value, yet we can see is financial institutions have an advantage in both fields.
Blockchain 1.0: The application of digital currency represented by Bitcoin includes scenarios such as payment and circulation. The decentralized characteristic of digital currency has solved the problem of centralization payment methods.
From the prospective of area: Goldman Sachs, IBM and other companies participate in DAH (Digital Asset Holdings) financing up to 60 million US dollars. Visa, Nasdaq, Citi Ventures, RRE Ventures and other companies participate in Chain financing up to 30 million US dollars. In addition, active investors in the global blockchain investment industry include: Andreessen Horowitz (also called a16z), who invested in star companies such as Facebook and Airbnb, has a digital currency group and blockchain capital company that invested in more than 70 blockchain startups. They even invest such as Baidu’s Capital Partner Tim Draper, Silicon Valley’s famous incubator Y Combinator.
From the classification of project type: the hottest area of investment is finance, followed by the communication industry, mainly including trading platforms, wallet payments, etc. Types of projects invested in blockchain mainly include the underlying technology and infrastructure platforms such as digital asset management, media socialization, and digital wallets. Blockchain underlying technology, SPI model, media social, digital wallet (include digital asset management), are very popular in the capital market.
From the perspective of investment and financing: blockchain investment in the United States is leading the world. Since 2012, Bitcoin and blockchain startups in U.S. have obtained 270 investment transactions with a financing amount up to $1 billion US dollar, 55% of total global blockchain financing which is the highest rate in the world; followed by UK which had 6%, 3% in Singapore, and 2% in China, Japan and South Korea.
The financing record of the “blockchain+digital currency” in 2017 was broken in the first quarter of 2018. In Q1 of 2018, the amount of financing in the blockchain reached 6.72 billion yuan. 54 and 33 financings were obtained in the blockchain and online loans with corresponding financing amounts of 6.72 billion yuan and 4.87 billion yuan respectively.
Blockchain 2.0: The Economist described one implementation of this second-generation programmable blockchain as coming with “a programming language that allows users to write more sophisticated smart contracts, thus creating invoices that pay themselves when a shipment arrives or share certificates which automatically send their owners dividends if profits reach a certain level”. Smart contracts have great potential to subvert human social structures and have been put into practice from the theory. In the past 240 years, we have witnessed four technological revolutions. Today, blockchain technology is setting off a new revolutionary boom.
When the new technology system has commercial potential, we have entered the outbreak phase of the technological revolution. At this stage, the economic logic of the new system begins to emerge and a new “Technological Paradigm” will be formed. The new “Technological Paradigm” can improve efficiency, profitability and competitiveness of enterprise. It can also jointly drive a wave of technological revolution from the three dimensions of economy, system and technology.
Blockchain technology has accelerated from digital currency to other areas and is integrated with innovation in various industries. The application of the future blockchain will be promoted in two directions: the first is the IT field, starting with information sharing, building credit at low cost, and gradually covering digital assets and to other fields; second, starting from the currency and gradually moving toward to the asset side.
In such a process of advancement, we cannot help but ask: Is blockchain finance a digital currency? Fortune password? Or a speculation negotiation?
As a new trend in financial industry, the operational logic of blockchain finance are remain unchanged. Correctly understanding the emergence and development of blockchain finance can improve our mind.
Blockchain 3.0: It includes the underlying technology enhancement, encryption algorithm, multiple access methods, and multiple consensus mechanisms. It is used for the increasingly automated distribution of physical resources and human assets around the world, promoting large-scale collaboration in science, health, education etc.
The development and production of blockchain technology is not the inevitable result of technological progress and innovation, but the dissatisfaction of traditional monopoly organizations on the long-term monopoly and domination of human economic, cultural and social life. Because, with the continuous development of blockchain technology, our private goods and fixed assets are likely to evolve into digital asset in the near future. Blockchain technology offers an unlimited number of applications for this form of appearance.
Digital asset trading platform bitget perfectly combines blockchain and offline finance. Based on regular transactions such as currency trading and leverage, bitget provide financial derivative services such as legal currency transactions and contracts. The differences from other platforms is Bitget has launched the “Investor Growth System”, which is trained and shared by professional investors and retail investors. The community will be motivated by GT (bitget global universal points). At the same time, the “Best Partner (BCP) Program” was launched to attract more professional digital asset investors to build a complete blockchain financial system.
Over the past two hundred years, technological revolution has brought us earth-shaking changes in our society and humanity. It is expected that in the next ten to twenty years, blockchains may bring more changes.
Charles Dickens once said: “It was the best of times, it was the worst of times, it was the age of wisdom (A Tale of Two Cities).” We need to embrace the investment opportunities brought by the new technological innovation; help financial institutions and technology companies to enter the blockchain technology and achieve the goal of “driving the blockchain for own use”. At the same time, it is ready to take the corresponding risks.
■ Source: Bi Shi Jie (幣世界)
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