Blockchain and cryptocurrencies have a number of potential applications which are vastly beyond the funding of startups. In addition to aiding investors and entrepreneurs, they can also be used for Ethereum, crowdfunding, finance and governmental functions.
Ethereum is a type of platform that uses blockchain as its foundation and was conceived of to make up for the many shortcomings which are associated with Bitcoin. It is geared towards distributed computing and as such can be used for the creation of smart contracts, tokens and Initial Coin Offerings.
Blockchain allows entrepreneurs to acquire capital directly from the public without being beholden to banks or venture capitalists. It organizes capital distribution while ensuring investors are protected from fraud and embezzlement, ensuring that the capital provided is used for the activities which it is pledged towards. This is all achieved through ICOs, or Initial Coin Offerings where tokens are issued which can be purchased, held or traded at a later time.
Crowdfunding is the mechanism by which startups can be funded. Because the funding is conducted through blockchain, it has exceptional security, transparency and efficiency, which gives participants peace of mind since they will know where and how the funds are being used. Developers in turn will get the funding they need to launch their product or service and then provide it to the public, while giving special rewards to those that financed it.
Startups have a lot to gain by taking advantage of blockchain, since it is a platform which is not physical and is decentralized completely. As a result of its distribution throughout the World Wide Web, it can be used to launch startups without having to rely on traditional funding sources such as banks or venture capital. Instead, entrepreneurs can turn to the public, and elicit funding from those who are interested in the idea and would like to see it realized and receive rewards for their participation.
The financial benefits associated with utilizing blockchain include a substantial reduction in costs, since entrepreneurs and investors no longer have to depend on middlemen. Furthermore, this revolution will decentralize the web further; concentrating economic power in a greater number of hands as opposed to restricting it to a privileged few. Finally, it will create greater innovation overall, bringing more products and services to the market which provides more options to consumers at a reasonable price point.
Governments can reap many benefits by taking advantage of the blockchain platform. For one, they can raise the funding needed for various projects or initiatives specifically from citizens who are interested, without the need to levy taxes, and can reward them for doing so through the issuance of tokens or other perks. Furthermore, blockchain foments greater transparency and efficiency in voting and other political functions which ensures that the citizens are being represented by their elected officials.