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Do Industries Need Cryptocurrencies?

It’s probable that 2018 will be a watershed year for blockchain and cryptocurrencies. 2017 saw the breakout of this new technology from the small community of programmers and “geeks” into a much wider audience of people, looking for financial opportunities and willing to support various disruptive Blockchain concepts. 2018 will likely see the acceptance by specific industries of cryptocurrencies created for that industry.

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Ripple (XRP) is probably the most visible example of this trend. It was specifically engineered to address problems the banking industry has with international transfers. Dentacoin was designed to do the same thing for the global dental industry. Of course, some argue that Bitcoin could be just as easily used for either purpose. Those making this argument are ignoring some of the basic rules of business and cryptocurrencies.

Business 101: Control Costs

The first lesson of business is to learn how to control costs. Any industry that operates in more than one country has cost of exchanging currencies. Promoters of the Euro knew this and argued that it would smooth “currency transfers within and outside the EU and reduce(s) the costs of such transfers”. The same is true for international banking and the global dental industry.

Adopting an industry-wide cryptocurrency makes it easier for any provider in the industry, from dentists to manufacturers, to price their goods and services. A single monetary unit also allows customers in the industry, both patients and dentists, to shop more easily for the most competitive price. This will drive costs down and increase the overall efficiency of the entire industry.

Bitcoin cannot provide this benefit. Although it meets the criteria of an international currency, it is not widely accepted. The technical problems with the speed of posting transactions, the ongoing volatility of the market price and the high transaction fees all hinder universal adoption. There are other reasons that will be discussed later that show why Bitcoin is unsuitable for use as a global dental currency.

Business 102: Serve the Customer

The second lesson of business is that you do not take care of your customers, someone else will. This is why Dentacoin is going to be successful. The global dental industry has done a horrible job taking care of the oral health of the world’s population so far. 90% or more of the total spent on dental services is wasted on fixing problems that could have easily been prevented.

There are many customers in the global dental industry, including people who need to find a dentist. These individuals are served by the Trusted Review Platform, a blockchain based compilation of reviews funded by Dentacoin. Customers also include dental practices that want to attract new patients and who buy supplies from producers in other countries.

Allowing patients to earn Dentacoin by posting reviews or by using other applications promotes the goal of improving global dental health in a direct, tangible way. It does this much more effectively than payments in Bitcoin or other cryptocurrencies for a variety of reasons, including meeting the third most important rule of business.

Business 103: Build the Brand

Creating “brand awareness” is critical to the success of a business or any organization. Customers come to recognize the brand and associate it with great qualities. Logos and marketing slogans are an important component of accomplishing this goal. Dentacoin is engineered to become the global brand for quality dental care, equipment and supplies.

It will accomplish this goal by providing benefits for every member of the global dental health community. In fact, it will actually help create a global community, breaking down national barriers to access. A sticker announcing “Dentacoin accepted here” will one day be the universally accepted sign that the goods or services provided are recognized by the global dental community as the best the industry has to offer.

Bitcoin can’t do this. Its mission is to become a universal currency. The community it seeks to build is more diverse and varied than the one envisioned by Dentacoin. Just like a national fiat currency helps define a nation, the use of an industry-specific cryptocurrency like Dentacoin can help define an industry.

Cryptocurrency blogs and exchange analytics are still almost exclusively focused on the movement of market prices. This is likely to change over the coming year as the value of blockchain makes itself felt across the entire global business community.

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Factom Seems Keen to Enter the Stablecoin Market

It is safe to say the cryptocurrency industry has seen its fair share of stablecoins already. This market is open to competitors, although nearly 10 different offerings exist already. Even so, the Factom team is confident they can add at least one more competitor to the mix. Their unique stablecoin implementation will be presented later this month. Factom has Bold Plans Every venture pertaining to blockchain and cryptocurrency is worth paying attention to these days. Although things may be a bit different in the world of stablecoins, the new venture by Factom will still get quite a bit of attention. The team claims they have built a new implementation which might help shape the future of stablecoins altogether. Not too much is known about Factom’s exact plans. The team alluded to such a project in a recent blog post, although no real specifications were provided at this time. Instead, they only touch upon what makes stablecoins so peculiar, and why there is a need for more competition in this department. It is certainly true that more of these coins can bring more people to cryptocurrency over the years. In the normal world, a stablecoin is pegged to a physical asset. This can be fiat currency, as well as precious metals, natural resources, and so forth. To date, most stablecoins in the cryptocurrency world have been tied to the US Dollar. The only notable exception in this regard is Venezuela’s Petro, though that currency faces a lot of backlash for entirely different reasons. The lack of transparency associated with that venture is one of the key concerns right now. Based on the current modeling and research conducted by Factom, the team is confident their approach can be successful. However, no one should expect Factom-based stablecoin to come to market in the near future. Additional research and testing are needed prior to effectively commercializing such a technology. An initial demonstration of the concept will be presented during the Texas Bitcoin Conference in late October. The bigger question is what Factom will try to achieve exactly. With major companies such as Gemini and Circle issuing their own dollar-pegged currencies as of late, the stablecoin market seems to be on the brink of oversaturation. Factom’s venture will primarily focus on on-chain auditability, which is something most other projects and offerings do not provide at this time. Some positive competition in this regard can be quite beneficial to everyone. For the time being, it remains to be seen how the cryptocurrency community will respond to this new offering. While one can understand any company wants to get in on the stablecoin action right now, it is not a market which requires an abundance of competition either. Cryptocurrency needs more fiat currency onramps, rather than adding more intermediaries to the ecosystem. It will be interesting to see what Factom plans to do exactly, as this announcement leaves a lot of room for speculation. The post Factom Seems Keen to Enter the Stablecoin Market appeared first on NullTX.

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