With the advent of blockchain technology, the digital world has now become a hotbed for new and revolutionary financial tools. Having a decentralised, secure platform that acts as a launchpad for new ways to invest has given rise to various new strategies and methods for accruing wealth.
There are many ways in which blockchain has changed how we look at finance and wealth management, such as cryptocurrencies, NFTs, and Defi. All of these are interesting applications of technology that the world is now catching up with and building upon to create new frontiers in digital finance.
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For instance, cryptocurrencies have achieved significant growth in the last few years. Its value has already grown from $1.44 billion in 2020 to $1.63 billion in 2021. That is a compounded growth rate of nearly 13% in a single year! This is great news for enthusiasts and early investors, as cryptocurrencies can help create a great deal of wealth in a short period of time.
NFTs are another example of how blockchain technology can change how we approach investments. Their potential for creating wealth is mainly tied to their utility as digital proof of ownership for media and content. This is because they allow creators to monetize their work, earning royalties and commissions whenever their NFT is sold. This has created a lot of scope in the entertainment industry, considering that monetizing content such as music and digital art was hitherto a challenge.
NFTs can also be useful in other spaces, such as real estate. They facilitate a more streamlined experience for buyers and sellers and enable a more secure, hassle-free way to store records of ownership and sales. This makes them a valuable tool for industries requiring a lot of paperwork and recordkeeping.
In terms of investments, cryptocurrencies and NFTs provide a solid route to fast and consistent profits, whatever your risk appetite may be. They are backed by a community of enthusiasts, investors, and collectors actively engaging with the technology to create new ways to grow your wealth every day.
The Future of Digital Finance:
With other blockchain applications, such as decentralised finance or DeFi as it is popularly called, 2022 is sure to bring further optimisations, improvements, and applications of cryptocurrencies and NFTs. The technology might be able to deal with the current challenges such as regulation and potential malpractice like wash trading or asset counterfeiting.
Blockchain investments may seem risky due to such practices, but there are already various tools available to help ensure that you make profitable and safe investments. Such tools are set to improve as the community further engages with the technology and identifies areas of concern. The market is expanding with tools that could detect the primary concerns surrounding NFTs such as wash trading, asset duplication, and price gouging. Thus, allowing investors to make informed decisions, enjoy a secure, and risk-free experience with NFTs.
Considering the extensive use cases of NFTs and cryptocurrencies and their phenomenal growth since their inception, it is certain to be a good year for blockchain technology and its many applications. Aside from being a smart decision, investing in these different applications will also be rewarding!
Views expressed in this article are the personal opinion of Vijay Pravin Maharajan, Founder & CEO, bitsCrunch.