The dizzying valuations of cryptocurrencies have sparked a frenzy of investor capital and interest in this new “wild west” that some have compared to the dawn of the Internet in the mid-1990s.
Bitcoin, the most familiar and used cryptocurrency, started 2017 at around $1,000 and finished the year just under $15,000 - a gain of 1,322%. Ethereum rose in value by over 2,500% in 2017. As crypto surged, many investors stayed on the sidelines, scared off by the volatility. When South Korea announced it was banning bitcoin trading, BTC dropped $2,000 in one morning. But hedge funds and institutional money are pouring into bitcoin, with Goldman Sachs (NYSE:GS) exploring how to help clients trade digital tokens, and other companies looking at ways to bring crypto into the mainstream - by opening up regulated coin exchanges, creating futures contracts and attempting to list coin exchange-traded funds.
Many do not realize that without blockchain there would be no bitcoin. As the price of bitcoin spiked, there has been a flood of interest in blockchain technologies, which use a decentralized, public ledger of transactions that can’t be manipulated and is therefore highly resistant to hacking and fraud, while remaining public and transparent. IBM (NYSE:IBM), Microsoft (NASDAQ:MSFT) and Toyota Motor Corporation ADR (NYSE:TM) have all invested in blockchain, which has practically endless applications - everything from “smart” contracts and supply chain auditing, to microgrids and stock trading.
But not all companies with the word “blockchain” attached to them offer the chance for shareholder returns. This is a space that is equally ripe for both charlatans and pioneers, and investors must therefore tread carefully. DMG Blockchain Technologies stands out as a company that Ahead of the Herd investors can get behind. Before we get into the reasons why, a bit of background is in order.
What is blockchain?
A blockchain is like a spreadsheet that is duplicated thousands of times across a network of computers. The network is designed to regularly update this spreadsheet. A great example of a simple blockchain is Google Docs, which allows a document to be shared and edited/ commented on by an infinite number of people at the same time. The advantages of such a system are that the blockchain database isn’t stored in any one location - making it virtually unhackable - while its records are public and easily identifiable.
RBC Capital Markets is much more detailed in its explanation of blockchain:
A blockchain is a distributed and decentralized database of records or public ledger of all transactions or digital events that have been executed and shared among participating parties. Each transaction in the public ledger is verified by consensus of a majority of the participants in the system. Once entered, information can never be erased. The blockchain contains a certain and verifiable record of every single transaction ever made. This is significantly different from a centralized database given that it is open for all to see (public).
In order to attack the network, one would have to attack all computers on a network that is spread around the world versus in a single data center or centralized distributed ecosystem. The value of a blockchain is that it enables a shared database without a central administrator (disintermediation). Rather than having some centralized application, blockchain transactions can have their own proof of validity and authorization to enforce the constraints.
A blockchain is a technology to efficiently record transactions, with key advantages being disintermediation, decentralized, distributed, programmable, verifiable, divisible, immutable, and with faster and lower cost to data.
To read the entire report Please click on the pdf File Below: