If there is one revolution that is slowly paving the path towards a connected world, it is Blockchain technology. Blockchain has, in fact, brought innovation and new opportunities across the globe in many industries. It has given way to the popularity of Bitcoin and Cryptocurrency and with spectacular gains of over 3000% in 2017 followed by volatility in 2018, it’s fair to say this asset class has got our attention.
To break down the potential of Blockchain and to understand how scores of industries are benefiting from this revolutionary technology, we need to analyze it in comparison to other disruptive innovations of the past. Understanding the DotCom innovation and how Blockchain is gradually taking over can give us a panoramic picture of what the future holds. Let’s break it down and look at the 3 disruption patterns, evident in all major disruptions.
DOT COM VERSUS BLOCKCHAIN- AN ANALYSIS
1. The starting point is always a true disruption coming from groundbreaking technologies that enable completely different business models.
Internet: The new technology allowed for CDs to be sold more easily online. However, the disruptive business model came with music streaming. It gave us all the music we could ever want for a monthly price and this model has since killed the CD business.
Blockchain: This newer technology is super secure and with trust built into the core, it enables fairness and transparency like never before. A radical application is Inmusik, which pays fans for their contribution. The music streaming platform allows listeners to vote/bet on which songs they think will be loved by others. When a song receives payouts from a stream, the fans that helped create that success with their votes, also get paid a percentage. Now isn’t this an exciting and disruptive business model?
2. In an underground movement which challenges the status quo, the first group to embrace the new movement always wins.
Internet: Sticking to music as an example, the transition from CDs to a digital format enabled peer-to-peer sites to provide users with access to all music for free. It was this early and passionate adoption that paved the way for many music streaming platforms.
Blockchain: The first group of people to jump onto the blockchain bandwagon in the music space were independent artists who were tired of the meager payout they received from streaming platforms and saw blockchain as a better solution for tracking and transparency. This was also the inspiration for Inmusik.
3. The best way to make new technologies better is by tackling questionable activities that negatively impact the space as some people find ways to take liberties using the technology.
Internet: Music and movie piracy became widespread and the ease of access allowed some to profit from copyrighted content selling bootlegs. Pornography and gambling were also early uses of the internet, scaring away some investors from getting involved.
Blockchain: Digital currencies allow people to transfer money without it being detected by central banks or governments. This opened the door for activities like money laundering which has led, once again, to a pushback from investors and larger institutions.
BASED ON THE DOTCOM DAYS, WHAT’S NEXT FOR BLOCKCHAIN?
There are generally three phases of a disruption that have been common through history and is repeating with blockchain. They are:
In the earliest days of the technology, everything moves fast and with plenty of excitement. In the DotCom days, website traffic dictated share prices but many of these companies didn’t have a solid business model and were simply a bunch of cool ideas. Similarly, with Crypto, many currencies may have no real business model to fall back on. However, it’s likely that now we’ve reached the end of this phase.
More people invest and prices reach unsustainable levels of growth and ‘pop’, the bubble bursts! The DotCom burst of 2000 is extremely similar to the growth charts of bitcoin over the last 6 months but moving at a much faster rate. Learning from the DotCom days, this kind of correction is healthy for the industry long term.
This is where great innovators create more solid business models based on revenue growth and best practices. For the DotCom disruption, this phase saw the birth of some big internet companies. We have started moving into this phase yet again. Regulation kicks in and more investors get involved in searching for the next mega platform.
There’s no doubt that this last phase is going to change the world and impact industries in ways unimagined. As the highest ever rated ICO on Cryptoguruu, Inmusik may be worth getting involved with.
*This article has been written by Stephen Brett – Chief Executive Officer and Founder – Inmusik