Most people agree that investing in cryptocurrency in 2017 was an easy endeavor. It didn’t take any excessive skill, ability or insight. Instead, practically anyone could purchase a digital currency and sell it later for a profit. In a way, participating in last year’s crypto market felt like buying a lottery ticket that always won.
Of course, markets have shifted this year, and that’s introduced an entirely new layer of complexity, sophistication, and guesswork that significantly complicates crypto markets. Therefore, investors are left trying to determine which currencies have the greatest potential to produce profound returns.
At the same time, many people recognize that the blockchain, the technology that underpins digital currencies, is an extreme value proposition in itself. While people are divided on the efficacy of digital currencies, there is near unanimity about the incredible value of blockchain technology.
The blockchain received a high-level acknowledgment from the U.S. congress, which described it as “having many more potential applications” beyond just accounting for digital currencies. In addition, industry leaders and entrepreneurs alike are utilizing it to develop the next generation digital economy.
That’s why, in January, The New York Times Magazine wrote,
“The Bitcoin bubble may ultimately turn out to be a distraction from the true significance of the blockchain.”
To be sure, the article’s author, Steven Johnson, is not slighting the value of cryptocurrencies. Instead, he’s exclaiming the tremendous value associated with blockchain technology.
With that in mind, when looking at the long game, it might be better to consider which platforms are most successfully employing blockchain technology because that might be where the long-term value lies.
Old Company. New Technology.
Although the company is more than 100 years old, IBM is staying relevant by making a massive push into blockchain technology. IBM’s open sourced blockchain, Hyperledger, is their foray into the decentralized economy. Meanwhile, they’ve shared dozens of blockchain projects with direct, specific industry applications that are pertinent to, among others, the banking and shipping industry.
The priority of blockchain integration goes all the way to the top. IBM CEO, Ginni Rometty, has confidence in the technology. She writes,
“What the internet did for communications, blockchain will do for trusted transactions.”
The company already has dozens of blockchain services with more than 400 clients located around the world.
In other words, IBM is serious about blockchain technology, and that approach has some believing that the company may be a better long-term bet than Bitcoin.
Better Than Bitcoin?
Panos Mourdoukoutas, professor and Chair of the Department of Economics at LIU, is advocating for just that.
In a recent article in Forbes, the professor outlined his argument for IBM’s future prominence.
Mourdoukoutas asserts that:
“Simply put, the technology that created Bitcoin will eventually undermine it.”
He sees IBM’s status as a technology juggernaut as an essential advantage for the company. They have millions to spend on R&D, and they have other ancillary products that can help them generate adoption of blockchain technology.
Moreover, their unquestioned standing as a pillar of business innovation has brought them a cadre of influential clients including Walmart and J.P. Morgan Chase. Not only is this good for their business, Mourdoukoutas contends, but it also sends a signal to other companies that they can partner with IBM as well.
Mourdoukoutas is joined by David Drake, founder, and chairman of LDJ capital, in his belief. Citing the companies operational efficiency and comprehensive client-base, Drake notes,
“Yes, IBM can beat Bitcoin in Fortune 100 clients that utilize centralized solutions…”
There is some logic to Mourdoukoutas’ assertion, but it hasn’t yet played out in the numbers. Despite falling in value this year, a single Bitcoin is worth thousands more than a share of IBM. Still, Mourdoukoutas and others that share his viewpoint are playing a long game.
As blockchain technology continues to proliferate across different industries, its impact on the value of companies that provide those services could rise as well, Mourdoukoutas is undoubtedly hoping that’s the case.
Cover Photo by Kristopher Roller on Unsplash