In this era of highly effective and arguably revolutionary Blockchain Technology. The potential applications of Blockchain go far beyond Bitcoin and similar forms of money which may lead to a new era of Crowdfunding; the era of Disruption. Blockchain is gaining popularity and trust of people because of its ability to keep track of exchanges in a way that’s secure, publicly verified, and virtually impossible to use fraudulently. This is the perfect platform for creating, distributing, and exchanging currency. Soon, the ownership of other assets may emerge on the Blockchain scene.
Notably, because of the advantages of Blockchain, the world of Crowdfunding could be completely changed.
Crowdfunding is a method for small companies to finance the establishment and development of their business — an irregular strategy, compared to the traditional stock exchange IPO. This approach enables numerous projects to get more, faster, and lower-cost funding. Crowdfunding has skyrocketed in popularity over the past decade or so and it has become an extremely useful alternative to venture capital and has also allowed non-traditional projects, such as those started by in-need families or hopeful creatives, a new audience to pitch their cause.
Through cryptocurrencies, the most well-known creation of the Blockchain — the barriers to crowdfunding the needy in pauperized and war-torn areas of the world where financial support is needed in the bulk could potentially be reduced. By installing systems of communication in those regions, such as the internet, translators, and crypto-to-fiat conversion systems, the stories of the needy detailing why they deserve crowdfunding could be effectively told and passed along to those eager and able to support humanitarian causes.
The natural advantages of blockchain technology can support and improve crowdfunding in several distinct areas:
- Decentralization- The Blockchain is completely decentralized. This means it isn’t going to depend on any platform or combination of platforms to allow creators to raise funds. That’s going to have multiple positive effects for the crowdfunding community. For starters, you’ll no longer be beholden to the rules, regulations, and whims of the most popular crowdfunding platforms on the internet. Literally, any project has a chance of getting visibility and getting funded. It also eliminates the problem of fees. While Blockchain upkeep does cost a bit of money, you’ll cut back drastically on transaction fees. This makes crowdfunding less expensive for creators and investors.
- Accessible Equity- Instead of crowdfunding to enable pre-orders of upcoming tangible products, blockchain could rely on asset tokenization to provide investors with equity or some similar concept of ownership. For example, an inventor who plans on creating multiple new products with the incoming funds could grant each new investor with a small ownership stake in the company, commensurate with the amount they contribute. That way, investors will see success proportional to the eventual success of the company. This could potentially open whole new worlds of investment opportunity.
- Universal Availability- Any project using a Blockchain-based crowdfunding model can potentially get funded. Also, any person with an internet connection can contribute to those projects. There may be some demand for discovery and visibility platforms. But, there isn’t a fundamental limitation the way there is for crowdfunding projects today.
- Immediate Provision- Blockchain-based crowd funders wouldn’t have to worry about the “empty promises” that have plagued modern-day crowdfunding projects. Instead of contributing money and waiting weeks or months to receive the promised product, contributors will immediately receive fractional enterprise or product ownership.
- Flexible options- Using the Blockchain as asset tokenization grants creators and entrepreneurs more liberties. They can raise more funds by issuing more fractional shares in their enterprise and use those funds to expand. Yet, they can also take advantage of those fractional shares directly. For example, they could save money on hiring employees by compensating them partially in fractional ownership of the business, converting it into an employee-owned enterprise. Asset tokens become their own form of currency in this model, enabling organizations to do more like hire professionals like marketers and advertisers.
- Peer to Peer Exchanges- Just like cryptocurrency today, it’s possible to exchange crowdfunded business or product stakes on a peer-to-peer basis. This provides contributors with more liquidity for their investments. It could serve as a way to generate more interest in the project overall. This change could eventually precipitate the creation of an entirely new type of marketplace.
Toward a New Era of Crowdfunding
It’s no secret that crowdfunding has enormous potential. Even in its current, flawed form, funding is helping new entrepreneurs, inventors, and creators improve the world. In the near future when the Blockchain serves as the backbone of democratized investor contributions, it’s going to be even more accessible, secure, and flexible for creators and investors. It’s only a matter of time though the exact length of time is hard to estimate. There are still some challenges to overcome and only so much Blockchain talent to go around.
Frequently Asked Questions
How do I choose a trustworthy app development company?Here are a few things to remember to choose a reliable mobile app development partner:
- Choose a partner that cares about its clients.
- Never compromise on technology experience and domain expertise.
- Check out your development partners’ portfolios, customer testimonials, and references.
- Observe how they approach communication and how much they pay attention to your vision.
- Ask the right questions to help you choose easily.
Why is India preferred for app development outsourcing worldwide?Here are a few reasons why India is one of the preferred outsourcing destinations:
- The average outsourcing charges in India are $18 – $40, which is way more affordable than in developed countries like the USA, $38 – $63.
- India has a large pool of native-English speakers who’re highly proficient in their work.
- With an Indian outsourcing partner, you can access 24×7 support and specialized IT talent.
How much time does it take to develop an app?Depending on the complexity of a mobile app, it can take several weeks to several months to develop it. An app like Uber takes around 1200 hours to develop. On the other hand, a dating app like Tinder can be developed in 1000 hours.
Freelancers vs. app development company – which one is better?Pricing-wise, freelancers appear to be more affordable. However, they offer no accountability for your mobile app. You can’t hold them accountable if the app doesn’t turn out to be as expected. On the other hand, an app development agency takes complete responsibility for your mobile app. Hence, an app development agency is better than a freelancer.
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