This time last year, bitcoin – and “digital currencies” writ large – was all the rage. Average Joes, fearful of missing out, jumped on the bandwagon, sending crypto prices skyrocketing.
Hell, even my father asked me, “What’s a bitcoin?” That’s when you know the trend is near its end. Dad’s always the last to know.
And, yet, what a difference a year makes!
Cryptos have crashed, and a lot of people are holding empty bags. Losses are huge.
But, although the craze has faded, the technology supporting digital currencies continues to buzz.
Blockchain is a theoretically secure digital ledger with an internal, self-perpetuating transaction verification system.
Applications and investment opportunities – right here, right now – appear to be unlimited.
Consider Vermont, where my father lives. It’s one of the most rural states in the union, and it’s often considered “anti-business” due to its left/libertarian leanings, Bernie Sanders, and high taxes.
However, the Green Mountain State’s Republican governor just signed a bill that specifically promotes the development of blockchain businesses. Vermont’s state government is actually using the technology to record and file land records.
My old man knows a lot about real-estate law. I know from talking to him that having one secure, immutable place to store land records and similar paperwork would save a lot of time and money.
It’s a problem that needs solving, and Vermont intends to spread the technology as much as possible.
The state plans to allow the formation of blockchain-based limited-liability companies. This move could well be a huge boon to its economy which has been struggling to keep workers in the state.
Blockchain technology isn’t just going to be a boon for Vermont’s picturesque acres. It has global implications for real estate.
Real estate is far larger other financial assets like stocks, but making real estate broadly investable can be a pretty tricky process. Not anymore.
Blockchain technology can be used to help “tokenize” and break up a piece of real estate into fractional shares. Then, speculators will be able to more easily buy and sell illiquid assets such as a building (or even just a few floors of a building).
The same can be done for other types of investments such as art or wine that, until now, are much more awkward to trade outside of your traditional buy-and-sell framework.
Even Wal-Mart is getting in on the act.
The major retailer just announced that it’ll be using blockchain technology to track every head of lettuce and bag of spinach it sells. If farms want to sell their wares to Wal-Mart, they’ll have to comply.
Often, we hear of consumers getting sick off a bad batch of lettuce. Worst case, serious contamination leads to death, but it only takes a few bad leaves to drastically hit your bottom line.
Just ask Chipotle.
Ultimately, the blockchain can lead to less waste and higher profits. Potential contamination could be spotted earlier in the distribution process and allow retailers to react to problems before unilaterally clearing the shelves of potentially dangerous products.
Saved lives and healthier profit margins? That’s capitalism doing good.
And real estate and retail are just the beginning.
As with the advent of the computer and the dawning of the Internet Age, there will be big winners in the blockchain space.
If you want to be richer than Jeff Bezos, figure out how to legally buy and sell marijuana over the blockchain. The company that can pull that off will be worth a tidy fortune.
Wouldn’t hurt to do so in Vermont, boosting the economy in a beautiful part of the country…
The opportunities are endless. In Hidden Profits, our blockchain position has dropped with broader crypto space.
But – once the market really begins to separate the technology from the currency – the upside could be huge.
We’re only in the early innings of this game.