In recent years, investors have had to get used to the cyclical nature of the crypto markets. The last of these cycles, decentralized finance, is still developing. DeFi tokens have achieved unprecedented valuations in record time only to quickly empty, erasing tens or even hundreds of millions of dollars in market value.
The main reason why encryption and especially altcoins are so volatile is the lack of new money in the markets. Bitcoin and Ethereum may attract institutional investors, but altcoin traders still usually play a game of musical chairs. The rise of DeFi, for example, correlates with the brightness less performance of the pre-2017 alts - it's the same money chasing the next big bomb. Of course, we need new entries, but from where?
"Adoption" is the obvious answer, but it's worth clarifying what it means - real-world companies paying real money for blockchain projects that redistribute part of it to token holders through creative tokenomics.
The perfect use case for a huge market
One of several sectors where blockchain technology can make a real difference is big data. It is a huge market that is worth $138.9 billion by 2020 and will nearly double to $229.4 billion by 2025, according to market and market statistics.
While blockchain is generally a weak candidate for replacing centralized databases, it is fantastic to ensure the provenance and authenticity of the data. Even governments, usually slow in the adoption of new technologies, have begun to implement pilot projects. The Singapore Public Service is seeking to adopt blockchain to verify supplier history in GeBiz, thereby tracking the career movements of public officials and supporting or even replacing audit processes.
Estonia is already using technology to store public records. The UK Land Registry has partnered with the Methods project to develop a platform that stores land registration information and streamlines the process of buying or selling properties.
In the private sector, manufacturers are investing increasing amounts in research and development of integrated big data solutions. Suppliers are working to reduce equipment costs to gain a competitive advantage, optimize sales cycles, simplify customer service, and better understand customer needs.
GoldsteinResearch says key industry participants such as IBM, HP, Google, SAP, Cloudera and Oracle are progressively investing in R&D to develop unified big data solutions to provide enhanced analytics and integrated data management.
Companies are focusing on mergers and acquisitions to diversify their product portfolio with big data and mainframe technologies. For example, in 2015, Microsoft acquired Revolution Analytics to expand its business to cloud-based platforms. Similarly, IBM acquired Cloudant and Cleversafe to strengthen its cloud platform business.
In short, corporate big data is a huge market and blockchain technology can realistically capture a significant part of it. Projects in developing these blockchain big data solutions will achieve "true adoption" in the sense that they can attract new money to the crypto ecosystem.
Moreover, big data does not only concern the corporate market. The DeFi cycle may be deflating now, but the idea of decentralized finance is compelling and here to stay - and big data is right at the heart of it.
From understanding behaviour, patterns to KYC/AML compliance and reliable pricing feeds, big data is everywhere in DeFi. Oracles are an especially important use case with projects like Chainlink, Band Protocol, Tellor and Kylin Network – all of which have been on the market for a while and are growing.
A quantifiable investment
The size of the addressable market for big data blockchain projects is attractive, but what is even more attractive is that they can evolve into quantifiable businesses.
It is difficult or even impossible to apply traditional financial metrics to most altcoins, as there is no revenue. The price reflects hope, not fundamentals. Projects with real economic activity, on the other hand, can be analyzed - you can calculate profit per token or price per token in the same way you would for publicly listed stocks.
This makes big data blockchain projects a more conservative and reliable investment than tokens in the hype cycle. Some think this is a disadvantage, but they are perfect for building a diverse portfolio of lunar shots and reliable winners. Industry resources such as CoinGecko have already realized this trend and are monitoring big data projects as a niche that can become the "next big thing" that will overshadow even DeFi.
Blockchain data projects to watch
The three fastest development big data blockchain projects are Ocean Protocol, Quadrant, and Streamr. All three have real-world apps and real use cases.
Ocean Protocol helps developers create markets and other applications to publish, exchange, and consume data privately and securely. It also provides access control, data science, and other products that developers can use in their applications.
The Ocean Protocol got off to a troubled start with a controversial IEO and community shenanigans. However, the errors were rectified by the fact that the project rose to the top 100 in CoinMarketCap. The project currently has a market capitalization of more than $130 million.
The project roadmap points to the development of a community market in 2020, extensive improvements in the core of ocean protocol, new applications and improved infrastructure, and incentive to provide data.
Quadrant Protocol is the blockchain arm of Quadrant Global, a big data enterprise location company that has been around since 2014. After conducting an ICO in October 2018, the Quadrant Protocol was flying under the radar with little communication. Unfortunately, this is clearly reflected in the token price, as the project has a relatively low market value and trading volumes.
On the other hand, the company mentioned during its last AMA that the platform is already profitable. If they can find a better tokenomics model, the project may attract more interest from investors.
Recently, quadrant protocol began to communicate more. Your updated project roadmap includes four new initiatives with real-world applications. The first to be released is Cape Canaveral, a consent management platform that introduces transparency into data supply chains by registering user consent in the chain.
The Baikonur Project also looks interesting because it directly involves the community - they can collect and validate location data using a mobile app and be rewarded in the project's native token.
Streamr is an open-source software project distributed with contributors worldwide. It is positioning itself as the missing link in creating a real-time data protocol for the decentralized web. Streamr is listed on Binance with a market capitalization of just over $30 million.
The project roadmap is ambitious and includes the refinement of its internal economy and scalability research, which proves that the network has low and predictable latency. Another milestone for them is the creation of data unions for redistribution of data ownership.
In light of the growing importance of big data in all sectors, blockchain projects targeted at this field may be among the best performing. They have the opportunity to capture shares of a multibillion-dollar market and attract new money to crypto.
Projects such as Ocean and Streamr, both listed in Binance and with solid performance, can attract existing traders in the hope of making a profit from fluctuations. At the same time, the quadrant protocol seems to be undervalued without listings on major exchanges.
As blockchain continues to mature, we expect market cycles to become a little less volatile. There's always a "shiny new object" like ICOs or vegetable chips, but at the end of the day, adoption and money talk.