2020 has been an incredible year for crypto as investors have generated windfall profits and crypto projects have seen their businesses gain the spotlight they’ve been looking for. While Bitcoin has received most of the attention after major institutional investors announced they were accumulating the increasingly scarce asset, many altcoins have also seen their fair share of glory. When looking at all the big winners of the past year, the first project that probably comes to mind is Chainlink, having appreciated by more than 550% YTD and now valued at over $4.5 billion. But, the actual biggest winner of the year is HEX with a YTD return of over 5,000%.
I mention both of the above projects as they have each taken slightly different paths to achieve greatness. Chainlink has devoted resources toward building a fundamentally sound business with many strategic partnerships while HEX has spent vast sums of money on marketing and promotion. Both approaches are valid, but one thing is certain, it is absolutely imperative for crypto projects to let the crypto community know what makes them special. Of course, one of the reasons that makes crypto so valuable is the powerful blockchain technology that most projects are utilizing.
Cryptocurrency vs. Blockchain Technology
It’s important to make a distinction between blockchain technology and cryptocurrency. Although they are often used interchangeably, they are different. Blockchain technology and crypto were both created after the 2008 financial crisis, but cryptocurrency actually falls under the larger category of blockchain.
Cryptocurrency is a digital currency in which transactions are verified and records are maintained by a decentralized system using cryptography. Essentially, it is a currency that runs through the utilization of blockchain technology. Blockchain is a term that refers to a set of technologies that uses a system of record keeping by cryptographically linking blocks of transaction data together in a ledger.
While each cryptocurrency projects will have a special use case, the really valuable component is how those projects are using blockchain technology. Unfortunately, while blockchain technology is making inroads, it is still relatively unknown.
Blockchain Technology is Growing but Remains Relatively Unknown
One fascinating aspect of the business growth vs. marketing debate is even the underlying technology upon which crypto is based is still relatively unknown. Netherlands-based credit management firm, Onguard, published results of a survey conducted by Verdict, about the awareness of blockchain technology and how it might prove useful within the financial service space. Shockingly, 29% of finance professionals surveyed had no idea what blockchain technology is, and 19% had no clue how it could be deployed within the business world.
The results published in this survey are eye opening because although blockchain is becoming a buzz word within the business world, those who would perhaps be tasked with the responsibility of deploying such technology wouldn’t know where or how to begin. This circles back to the question of how important marketing is, specifically Blockchain PR, in building a business. I would argue that is of paramount importance. While growing a business organically through sales and partnerships is of course important, there will be no business or sales or partnerships if people have no idea it exists. Further, if financial professionals don’t even have a strong grasp of the underlying technology, how could they possibly begin to understand more niche projects within the cryptocurrency world?
As to whether crypto companies understand how important marketing is, it seems the answer is a resounding yes. There appears to be a growing need for community/ecosystem managers within the cryptocurrency space. In fact, Chainlink Labs is currently looking for an ecosystem manager. These roles are normally heavily involved in creating content, partnering with social media influencers, managing media channels such as Reddit and Telegram, and ultimately attempting to build a thriving community.
At the end of the day, blockchain technology and cryptocurrency are still relative unknowns within the finance world. I have no doubt that this will change over time, but until the day comes, it is imperative for companies to take advantage of all the available communication channels in order to spread awareness. Each company has its own mission and purpose but, ultimately, we are all in this together. If it’s good for one, it’s good for all.