Blockchain is a modern business concept. With blockchain, companies can transform their company into a decentralization network that can change the way their business operates. It affects companies, the distribution of sales, revenues and also ensures that development is sustained despite the transition.
Distributed network system will transform the way a company works, but it also allows creativity to grow rapidly. That’s why you’re going to see a lot of businesses embracing blockchain. These same firms also tinker with blockchain making it more possible for more widespread adoption.
With creativity at the forefront, we are now seeing an expansion in the use of blockchain business models. In today’s post, we’re going to discuss blockchain market models. Decentralization has also transformed the way we approach and address the issues around us. Not just that, but it still opens up a lot of doors for companies beyond. So how are they going to do it? The approach is to identify and apply the best blockchain business models correctly.
Blockchain business models shouldconcentrate on developers rather than just customers. This will make initiatives more utilitarian rather than business value, making blockchain enterprise ideas can operate at both the macro and micro stages, helping both internal organization staff and end-users.
Conventional Business Model vs Blockchain Business Model
Every business models will position companies offer services or products and make money from the operation. Consumers purchase the good or service at a prescribed cost. The prices are fixed accordingly and consist of all salaries or other costs that the company may or may have accrued during the operation or merchandise distribution process. A company has a particular way of doing the business. This conventional business model is a centralized business model.
Blockchain Business Models
Now that we’ve developed a clear understanding of conventional blockchain models and how the company makes money off them, let’s talk about the most popular blockchain business models.
1. Token Economy
The business model of utility tokens is widespread in the industry. We have addressed earlier in the article where we attempt to explain the blockchain business concept from the lens of the utility token business model. Actually, there are lots of startups, enterprise or eCommerce platforms that use a blockchain-based utility platform. Few decentralized market examples include BANKEX tokens, EDU tokens, and so on. Ripple is also a utility coin, since it empowers the network and promotes network operations in one manner or another.
Businesses retain some service tokens and release the others for network functionality. They make a profit as the value of the utility token is changed. The concept of dealing with tokens can be summed up by the term “Tokenomics.”
2. Blockchain-as-a-Service (BaaS)
Blockchain is one of the most common blockchain business models out there. It’s all about creating an infrastructure for other companies to operate their blockchain system. Companies will experiment, test and carry out studies in this ecosystem. Right now, Microsoft(Azure), Amazon(AWS), IBM(BlueMix), etc. offer blockchain as a service(BaaS) and are the best example of a decentralized business model.
End users (in this case company, startup or organization) don’t have to think about how blockchain operates and don’t need to set it up before operating on it. BaaS thus removes the need for hardware, and in turn allows start-ups, businesses or organisations to concentrate on their growth cycle.
3. Developer Network
This form of blockchain business model refers to all blockchain implementations, such as Ethereum or dApps, which charge a small sum to the user for various operations on the network. For eg, the Ethereum network charges the Ethereum developers to render their dApp live. The same applies to NEO and has a dApp publishing fee.
4. Growth Platform
The general definition of blockchain is still at its native level. A lot of progress and analysis goes into blockchain as startups attempt to address challenges in a special way. This takes us to our next open market model known as development platforms. Companies are also focused on creating applications that will contribute to a blockchain infrastructure. Apps that can be used by blockchain and cloud to provide accelerated growth to the end user.
5. Blockchain-based Software
The blockchain framework was launched in 2009. However, the need for blockchain is more than ever before. This means that the major old players will have to embrace blockchain faster.
The best way to collaborate is to buy a blockchain solution and incorporate it into their scheme. This gives rise to the blockchain firms who build a solution and then market it to larger companies. Proving blockchain technologies to other companies will be incredibly lucrative, as they can not only get a fair upfront charge. In addition, they would still need to provide assistance after implementation.
6. Professional Services
The last blockchain industry model that we’re going to explore is the professional services of Blockchain. These services are offered by leading expert tech firms to start-ups or other companies to get them equipped for blockchain. For example a company would like someone to create a custom blockchain project. In that case, firms such as Deloitte, IBM or others could be employed to finish the job.
The key here is not to invest in infrastructure, software or team building, but to take full advantage of the professional services of companies that have mastered the art of blockchain growth. You can also see smaller players on this market. Overall, it’s a perfect blockchain business model for skilled blockchain practitioners who want to use their talents to do business.
There are also other types of blockchain professional services. For example, many blockchain driven businesses provide blockchain related services, such as consultancy, legal records, or business auditing.
7. Peer-to-Peer Network
Peer-to-Peer or so being called P2P provide a system in which users are able communicate directly with each other. It can be monetized in several respects, including coins, BaaS or transaction costs.
IPFS, an interplanetary file system, takes advantage of the business model of the blockchain. Filecoin also uses the P2P blockchain business model by offering a data storage and distribution network. To make it workable, someone who saves files for other users can get Filecoin for their contribution. Also there is mining program that will allow users to share their unused storage space.