What Google's New Blockchain Means for Small Crypto Companies
Written by Alexandra Perry
Posted March 23, 2018
When it comes to new, emerging technologies, blockchain is one of the hottest on the market.
In fact, if you're reading this newsletter, you've probably already heard of it. It's near impossible to interact with digital currency without hearing about blockchain.
But despite its fame, blockchain is still a hard technology to understand. That's why we have a detailed resource page dedicated to blockchain on our website.
That said, here's an elevator pitch.
A blockchain is simply a distributed ledger of information.
These distributed ledgers can make it possible for individuals to interact with each other and exchange data and money without a third-party moderator. Outside of empowering individuals, blockchain can also be used to improve the workflow and finances of large corporations.
A blockchain can be implemented to track information, secure user data, and even vastly speed up financial processes.
The world first learned about blockchain through Bitcoin, which relies on blockchain technology to function. In the wake of Bitcoin, multiple small startups have also started working with blockchain, using the technology to develop a whole new wave of digital assets.
But the blockchain space isn't just reserved for small startups anymore.
Big companies have officially entered the space, bringing with them money and resources that many small startups lack.
Here are just a few examples.
By the close of 2017, over 200 companies were working with the Enterprise Ethereum Alliance, a corporate alliance committed to the corporate development of blockchain technology.
Outside of the alliance, many corporations chose to pursue blockchain independently, including IBM, which just started marketing its latest Blockchain Starter Pack.
And last week, another big tech company entered the blockchain production fray.
It is this tech company that could change the way the market thinks about blockchain forever.
Google Announces its New Blockchain
On March 21st, tech giant Google announced that it would begin building its own blockchain-related software.
Now, this blockchain software will be a bit different from many of the blockchain projects investors hear about on the digital currency market.
This software is targeted, and Google wants to use it to both develop and add value to its developing cloud business.
And this is a good thing, because by using blockchain technology in its cloud business, Google can help give customers peace of mind when it comes to their privacy.
And trust me, privacy in the world of big tech is a pretty big concern these days.
Just last week, it came out that Facebook had been letting third parties access user data. This data was then used to sway political opinions during the 2016 presidential election. Not even Mark Zuckerberg's heartfelt apology could save Facebook's shares from plummeting, as individuals and companies deleted their Facebook accounts in protest.
In the wake of this kind of scandal, both users and companies are looking for ways to protect user data, especially considering that data is flowing through a vast network of computers and cloud networks.
Blockchain has come up a solution.
Google's new blockchain software would make it possible for users to track their personal data, assuring it will always be used appropriately.
Outside of releasing this blockchain, Google also plans to create its own distributed ledger, which will allow third parties to post and verify transactions. The release of this product has not been scheduled.
All of this is exciting news for Google, which has demonstrated time and time again its ability to be agile in the rapidly developing world of tech.
Embracing blockchain brings Google one step closer to the future and is sure to delight old investors and entice new ones.
That said, many are worried that Google's foray into blockchain could pose a risk to smaller companies in the space, many of which lack the money and power of an internet giant.
Will Tech Giants Kill Blockchain Startups?
It doesn't take a techie to know that in the last 10 years, companies like Facebook, Google, and Amazon have taken over.
Many of those companies started out by providing a niche and targeted service. Today, they rule their own technology kingdoms, where income can be generated from advertising, software, cloud networks, and data.
With all that income, big tech companies are free to pursue new technologies like blockchain.
That said, as the heavy hitters enter the space, there are some concerns that small blockchain companies are going to start feeling the heat.
While those concerns are legitimate, they likely won't end up becoming a reality.
While big tech like Google will likely produce some of the best blockchains on the market, they won't get there alone.
Historically, when Alphabet wants to venture into a new technology, it turns to startups that have already developed an expertise in the space. Alphabet's venture capitalism branch, GV, has already invested in a blockchain wallet service called Blockchain Luxembourg, as well as Ripple and LedgerX.
This means Google has been investing in small companies to build its next power play.
It appears that even though small companies lack the clout and power often hefted by tech giants, they are still a vital part of the developing technology industry.
Elad Gil, a startup investor who did work on Google's earliest mobile projects, stated it best: "Any time there’s a paradigm shift like this, there’s an opportunity for new giants to emerge — but also for incumbents to adopt the new approach."
When Blockchain Startups Meet Big Tech
In the future, digital currency investors are likely to see more partnerships between big tech companies and small blockchain startups.
These partnerships will help further innovation.
They will also help small companies survive in a blockchain world that is rapidly being regulated.
In this sense, big tech entering the blockchain fray should be viewed as a positive. It demonstrates that blockchain is more than just a whimsical idea hashed together by Bitcoin's creator. Blockchain is a force that can shake our world, and in being so, it's a force that the tech giants are willing to invest in.
We will keep investors up to date with Google's new blockchain service.
Keep an eye on your inbox for your “Digital Currency News Wrap-Up,” which comes out on Thursday.
@AlexandraPerryC on Twitter
Alexandra Perry is the managing editor of Token Authority and the associate editor of Technology and Opportunity. She also contributes weekly content to Wealth Daily, a free investment research newsletter that addresses a range of market topics. She has multiple years of experience working with startup companies, primarily focusing on artificial intelligence, cybersecurity, alternative energy, and biotech. Her take on investing is simple: a new age of investor can make monumental returns by investing in emerging industries and foundational startup ventures.
For Digital Currency, 2017 Was a Landmark Year…
The price of Bitcoin, the world's first digital asset, soared. And that turned many first-time investors into millionaires within a matter of months. Beyond Bitcoin, other digital assets also gained national attention and the support of massive corporations like Intel, Microsoft, and IBM.
But today, investors are looking at a different digital currency landscape…
A whole new wave of valuable blockchain companies is giving investors a second chance at Bitcoin-level profits.
At Token Authority, our goal is to provide investors with the actionable research and news that they’ll need to profit from this groundbreaking market. Sign up below to receive our free e-letter and a report detailing the top three digital currencies that you should be keeping an eye on in 2018.Sign up to receive your free report. After signing up, you'll begin receiving the The Token Authority e-letter.