A Quick Guide To Investing In The Blockchain

If you were given a million dollars to invest, how would you go about it? No doubt, you will do your research and settle on a plan of action that may involve stocks, Forex, municipal bonds, peer-to-peer lending, high-interest savings, annuities, Treasury Inflation Protected Securities (TIPS), and money market funds.

However, there is one source of income, you may have overlooked–the blockchain. This is probably because it’s a new form of wealth-building that only a few people are tapping into right now. Blockchain technology is the foundation or platform that supports all cryptocurrencies. Until recently, it was limited to the online world and primarily used for eCommerce transactions. Now, however, with the advent of companies like XYO Network, it has entered the real world of physical, location-based trade markets.

How the Blockchain Works

The blockchain is built on a peer-to-peer network of computers spread out across the world. It ensures that all transactions are transparent and secure.

In their book, The Blockchain Revolution (2016), the authors, Don and Alex Tapscott, offered a remarkably clear and concise definition of the blockchain. “The blockchain,” they said, “is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually anything of value.”

The blockchain is incorruptible for a simple reason: middlemen, like governments and central banks, are not necessary for the process of verification. Since the blockchain is not owned by anyone, no third party can dip into a transaction and grab a slice of the financial pie under the pretext that it’s a transactional or regulatory fee.

The Evolution of the Blockchain

The blockchain was invented as a way to validate a Bitcoin transaction. The network of nodes (computers) would verify the user’s status based on a known algorithm.

The next evolutionary leap occurred when Ethereum, a blockchain-reliant distributed computing platform, evolved Smart Contracts, DApps, and the ERC-20 Standard. The Smart Contract automated payment upon fulfillment of the terms of a contract. DApps are decentralized apps that work with smart contracts, making Smart Contracts suitable for use in resource planning and asset management. And the ERC-20 Standard provide Smart Contracts with Ethereum token standards for payments.

All this has been impressive enough, but now, more than a million beacons around the world offer a Proof of Location network. Bluetooth and GPS devices will be used to track all sorts of assets in transition. One use case, for example, is that it will help track an airline passenger’s luggage, saving airlines billions in lost luggage claims.

Investing In the Blockchain

So, how does this overview of blockchain technology, help you invest some of your million dollars.

While there are many possible ways that you could use the blockchain technology to plan your investments, here are two ideas: invest in the XYO networks Initial Coin Offering (ICO) and invest in cryptocurrencies for your portfolio.

  1. Invest in the XYO network:From March 20th to May 20, XYO will be offering XYO tokens. You can purchase tokens using Ethereum. 1 XYO is worth 0.00003 ETH, and this fraction of an Ethereum is about 0.0214 USD.
  2. Invest in cryptocurrency: You can choose to invest in Bitcoin or an altcoin, which is an alternative to the Bitcoin. The Bitcoin was the first cryptocurrency and remains the de facto standard. It was launched after Satoshi Nakamoto wrote a white paper about it on October 31, 2008. As for altcoins, there are now more than 700, with cryptocurrency analysts predicting that VEN, NANO, EOS, NEO, and XMR promise to return the highest ROI this year.

3 Simple Rules for Wise Investors

Here are three tips to bear in mind when investing in the blockchain technology:

  • First, do your homework. There is a lot of technical information that you must learn. As Warren Buffett has always cautioned investors, “Risk comes from not knowing what you’re doing.”
  • Second, take an experimental approach. Invest only a small percentage of your money, say 5%. Even if you have a good grasp of how something works, your timing could be off. By starting slow, you don’t risk making expensive mistakes.
  • Third, diversify your assets. Not only should you diversify between cryptocurrencies, but also diversify between traditional investments and cryptocurrencies.

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