The Different Sectors in Blockchain Technology
When I first started learning about blockchain technology, I was overwhelmed. As of May 2018, there are over 1500 crypto related companies listed on Coin Market Cap.
One day, it started to make more sense. That’s the day I categorized every crypto I knew into roughly 10 sectors. Now I only had to think about a handful of sectors, and not 1500+ individual crypto companies.
By putting things into categories, I was then able to more easily diversify my portfolio into sectors I found interesting. Here are some of the main sectors:
1: Infrastructure / Platform
Examples: Ethereum (ETH), NEO, EOS
This is a technology that other blockchain technology can be built on top of. Applications include Initial Coin Offerings (ICOs), and Decentralized Applications (Dapps). These platforms are often compared to computer operating systems.
2: Currency
Examples: Bitcoin (BTC), Litecoin (LTC), Ripple (XRP)
Nearly all of the crypto that exists can be used as a currency, as long as people are exchanging it and believe it has value. However, some cryptos have been designed from the start to function as a replacement for traditional fiat. The developers of those crypto currencies build in features such as lower transaction costs, faster transactions, and scalability.
3: Privacy
Examples: Monero (XMR), Zcash (ZEC), Verge (XVG)
Sometimes people want to make a transaction without another person knowing where it came from, or where it’s going. They also don’t want to publicly show how much money is in their wallet. Privacy coins solve these issues by masking, or hiding, the addresses and contents of the transaction.
4: Payment Processing
Examples: OmiseGO (OMG), Request Network (REQ), TenX (PAY)
In order to walk into a popular coffee shop or retail store and purchase goods with crypto currency, we need a way to make that transaction possible. The above companies are working on technology that will seamlessly deduct crypto from your wallet, and instantly send that same crypto to the seller.
5: Identity
Examples: Civic (CVC), Evernym, TheKey (TKY)
One day all of your personal information will be stored in the blockchain. Imagine having your medical records, tax information, or other contact info instantly accessible, and available to send to anyone at any moment. This is what the above companies are tackling.
6: Data Storage
Examples: Sia Coin (SC), Bluezelle (BLZ)
These companies want to create decentralized storage on the blockchain. This offers greater security since their data is stored on multiple computers globally, and not on one central server. Sia Coin is comparable to Dropbox while Bluezelle is comparable to Oracle. They both handle big data, but in different, and unique ways.
7: Entertainment (Games, Music, etc..)
Examples: Audiocoin (ADC), Vezt (VZT), Playkey (PKT)
These coins aim to connect fans with the artists, or video game players with a larger community. For example, ADC was given out to anyone who purchased the Utopia album by Björk in November of 2017. Vezt is a way to invest in the artist’s future music royalties. Playkey is a way for someone to share their computer resources so a remote player can play the game without using the processing power of their own computer.
8: Interoperability
Examples: Icon (ICX), Aion (AION), Wanchain (WAN)
Interoperability solves how different blockchains will communicate to each other. Think of this as a translation device (a protocol) between 2 different languages. These 3 companies are also part of the Blockchain Interoperability Alliance.
9: Supply Chain
Examples: VeChain (VEN), Walton (WTC)
Using blockchain technology, we are now able to track products from their origin all of the way to their final destination. This is accomplished using radio frequency identification (RFID) labels, which are scanned during the delivery process to ensure product authenticity and verify geographical location.
10: Trading / Investing
Examples: Binance Coin (BNB), Coin Lion (LION), Bibox Token (BIX)
People holding these coins have benefits, which may include reduced trading fees, voting for things on the exchange, or incentives to engage with the community. A pertinent example of this is Coin Lion, which offers LION tokens to people who contribute helpful information to their community, via the Research Portal.
I believe these are 10 of the most popular sectors, however, other sectors include Digital Assets, Real Estate, Gambling, Finances, Advertising, Recruitment, Governance, among others.
In conclusion, this is not professional, or financial advice, but just the opinions and techniques that I have found most profitable. I hope this information makes you a smarter investor. And remember, always have fun! If you cannot sleep at night, you are in over your head.
