by Ralph Tkatchuk

How blockchain builds businesses around individuals

Jan 04, 2018
E-commerce SoftwareTechnology Industry

The next generation of blockchain’s power users will be businesses in their own regard, motivating new users by example.

blockchain ecosystem
Credit: Thinkstock

Entrepreneurship is not a new idea, but has stepped further into the spotlight with the dot-com boom and the rise of VC funding for small startups, which have often consisted of just a few individuals. The term has an impressive flair, and brings with it the smell of new Silicon Valley money, but also the blood and sweat it took to build a business from scratch. Now that the internet has been around a while, it’s easier than ever to become an entrepreneur, but the path to total independence isn’t devoid of obstacles just yet.

Some refer to the internet as a ‘red ocean’ where competition is stiff in every regard, no matter which online industry one establishes a foothold in. This is a result of the internet’s gradual move towards centralization. Central web authorities and large stakeholders profit from the universal struggle for search placement, domain ownership, and access to one’s data and analysis tools. Moreover, intellectual property theft runs rampant wherever possible. Individuals with specialized knowledge or services can offer them to the public, but can only protect and distinguish themselves with significant investments of time and money. It’s easy to get lost in the fray, but blockchain is quickly turning this notion around.

Blockchain a boon to individuals

Blockchain is like the internet, and has the potential to become a portal for entrepreneurs in the same way, but it’s decentralized by design. The system runs by gathering power and organizing consensus from a large array of separate computers, instead of a single server. With some robust algorithms, these computers can work together to process transactions of data over the network and keep a permanent record of them together on a communal ledger.

Blockchains are like a hybrid mixture of a website and a community built around it, who all support the service, invest in it to varying degrees, and receive value in return. It encourages the participation of individuals, and in many cases, allows them to thrive as professional advocates. In blockchain systems, for which there are many with countless purposes, the existence of the ledger is one of the most pertinent boons to entrepreneurialism. It gives individuals more credibility within a community and enables people to prove that they are the owners and originators of any idea. Since most ideas relate to the underlying business or service that the blockchain supports, they can be monetized accordingly.

Take, for example, one of the most basic blockchain concepts making use of this benefit. In platforms like CoinDash, cryptocurrency traders can link their trades and the contents of their portfolio in real-time to a blockchain system using the ledger and smart contracts to replicate the same trades for others. It allows novice traders to copy the moves of professionals, with the ledger to verify that their trading history is truly as star-spangled as they say it is. This essentially allows any talented trader to become a mini hedge fund with notoriety in a populous system and be rewarded for their efforts.

Monetizing special skills

In niches that are smaller than the entire financial sector, blockchain is just as pertinent a solution for solo ventures. Those with a special knowledge or skill can find a more public, professional place for it, they just need to find a relevant blockchain community. One of the biggest benefits of these are the incentives individuals enjoy for sharing their insights rather than keeping them to themselves.

Where a savvy sports bettor might have once wanted to keep his or her successful strategies a secret, for instance, platforms like BlitzPredict deploy blockchain and cryptocurrency to make it more worthwhile to share them. BlitzPredict is like a sports book on the decentralized ledger, which tracks all other online books and aggregate odds to give sports bettors the access to the best lines. Their use of smart contracts provides improved accessibility and liquidity to bettors, but most importantly, it allows them to make more creative and autonomous wagers.

“Blockchain prediction markets solve the issue of trust, but liquidity remains a major issue. Prediction markets like Gnosis and Augur may take up to a week to grade wagers and resolve contracts. Money tied up in a contract can’t be deployed, hurting users’ bankroll growth…Our aggregator and liquidity reserve will ensure our users always get the best odds and receive guaranteed instant payouts,” reads a white paper put out by BlitzPedict

Wagers in the BPZ cryptocurrency can make use of customizable smart contracts that are fulfillable only when certain conditions are met. For instance, when the odds of a team winning the game reach a preset number, the contract activates and places a $100 bet. With the ledger to back up their performance over time, bettors can use both functions to gather an audience around their analysis, gaining recognition and profits from the community while adding value.

Translating blockchain legitimacy

Individuals who are making a living by the blockchain aren’t the only proof the young technology will need before gaining legitimacy in the traditional marketplace. Those who are paid in cryptocurrency will need better ways to make use of it in the pursuit of a normal life. Additionally, blockchain will need to address obstacles to entrepreneurship outside of its insular community.

As new solutions become more widely used, the influx of new participants will buoy those who planted their flag first. The next generation of blockchain’s power users will be businesses in their own regard, motivating new users by example. Individuals who familiarize themselves with and master the blockchain systems relative to their skill sets will one-day exercise greater influence in these matured decentralized industries.  With a real incentive, adoption will increase, empowering all stakeholders.