Is there any risk in blockchain investment?

Mr. Wu Xiaobo, a famous financial writer, specifically mentioned blockchain in the 2018 year-end show, "It is the worst new economic term in 2018, but it will be the detonating area of the next generation of information revolution". It is accurate to summarize the current state of blockchain with this comment. From its rise to being gradually understood by the world and influencing the whole world step by step, the innovation and development of blockchain technology has been achieved in ten years, but it is still difficult to hide a chicken feather in the investment market. Unlike other technological concepts such as artificial intelligence, big data and the Internet of Things, blockchain is a complex with both technical and financial attributes. Its technical attributes are high-end and pure, and it can create real value for the real world. However, due to its high cognitive threshold, it can only be popular in a small range, but it is difficult to attract the attention of all social strata. Financial attributes have higher universality, with eye-catching concepts can attract a large amount of capital influx in a short term, to achieve a more optimized allocation of resources. The technical attributes of blockchain guarantee the value support of its long-term development, while the financial investment market derived from technology has won a lot of attention and capital in a short period of time.

As a system that is always evolving iteratively, the complex properties that blockchain has today are not natural. Before 2014, block only financial value chain, represented by the currency early encryption currencies) aims to establish a set of independent from the reality of the financial system a peer-to-peer network payment system, often price speculation became the tool, the properties of a single block chain, its main value is only created a relatively small investment direction. The real explosion and growth of the blockchain concept occurred after 2014. With the introduction of smart contracts in the Ethereum project for the first time, more complex blockchain technology applications became possible. Many financial institutions and enterprises have paid attention to or entered the game. For a time, blockchain technology seems to be a panacea for all problems. The dissatisfaction of the public and enterprises on the existing Internet centralization logic has found an outlet, and blockchain technology has been entrusted with the task of subverting the Internet. Until then, the dual nature of blockchain was formally formed. Technology and investment market, as two parallel development lines of blockchain, are independent but interact with each other. Ideally, technology attracts resources, and resources drive innovation, forming a closed loop. However, in fact, the misallocation of resources in technological development is a normal phenomenon throughout the history of human economic development. In the field of blockchain, this misallocation is even more serious and has affected the whole world, resulting in what Mr. Wu described as the "worst" situation.

Resource misallocation in the blockchain field is mainly manifested in the serious deviation between market expectation and technology status quo. The application of blockchain technology started after 2014. Although entrusted with important responsibilities, it has not been applied in a wide range for the time being due to various reasons such as technical foundation, public acceptance and lagging laws and regulations. However, the blockchain investment market with cryptocurrency as the main object was born in 2009 and has more public foundation. The hot market pushes the blockchain concept to the general public, but the obscurity of the technical concept makes a large number of novice investors only follow the trend. At the present stage, the lack of entry barriers for cryptocurrency investment has led to the entry of some "unqualified investors" who lack basic knowledge. They often only care about the rise and fall of the trading price of each cryptocurrency, but have no idea about the technical dynamics and business model behind it. The market turmoil attracted another wave of professional speculators and scammers, creating a new vicious cycle that reached its peak in 2017.

The price of blockchain cryptocurrency is completely stripped of its technical value. Driven by capital and fueled by speculators, crimes begin to breed, and fraud and money circle become the main melody of the market. The chaos and malformations of the blockchain investment world cover all circulation links from zero-level market to derivatives. Valuable projects and teams that lack explosive points are not favored by capital, while the Ponzi scheme of hyping concepts is greatly sought after, which means that there are too many fools and not enough cheats. In the madness, many companies and teams without technical reserves rely on a white paper to issue money, hype concept packaging is the lack of core technology and business model is not consistent. But the market just needed an object that could be used for hype. It didn't matter whether the object was empty or not. Everyone involved in the investment market was trying to buy low and sell high to make a difference. Madness is called madness because it cannot last.

The blockchain investment market hit an all-time high at the end of 2017, followed by a sustained cliff fall. One year on, the average cryptocurrency market is now down 80% from its peak. Many economists understand the hype and collapse of blockchain cryptocurrency as another tulip scam. From the perspective of development and price trend, the evolution process of the two is very similar, but there are essential differences in in-depth analysis. There was no value behind the tulip bubble hundreds of years ago, and prices collapsed to zero. Although the application value of blockchain technology is seriously overestimated in the short term, it is still irreplaceable in the real world. This is also the main reason why the price of cryptocurrency has gone through several rounds of boom and slump in the past decade, but it is still on the overall upward trend. From more long-term perspective, the technology is still block the foundations of the chain development, capital market chaos, although let many people suffer huge losses, but also objectively stimulated the chain block technology to the attention of the world, along with the transition of the recent policies and corporate attitude, in the foreseeable future, block chain technology will have a better development opportunity. In fact, the short-term decline of the investment market corrected the serious mismatch of resources, allowing a series of fraud projects to be eliminated, but also enriched capital for real high-quality projects and teams. Although the means are relatively fierce, the benefits outweigh the disadvantages for the overall development of the blockchain industry.

Emerging bubble is inevitable in the development of science and technology, in the international famous IT consultancy gartner, 2018 update curve emerging science and technology development, chain block foam disillusionment period after the technology is developing at high, low, test and opportunities coexist, winter needs not only a strong man to survive industry DuanWan courage more from resilience yu gong yi shan type, Only by sticking to the dawn can we be reborn and truly have the qualifications and capital to soar.