The month of March saw significant price increases on tokens native from shared economy projects, especially those for cloud storage and file-sharing. Tokens like ANKR and STORJ made triple-digit percentage gains after Coinbase added them, and the same was true for FIL and LPT tokens after Grayscale began offering trusts based on the latter.
The only thing these tokens have in common is that they are all shared economy project tokens. While ANKR and STORJ offer decentralized cloud storage solutions, FIL is a decentralized file-sharing platform and LPT is a decentralized video streaming platform.
These concepts are not new. They already have centralized predecessors in the form of Amazon Web Services (AWS), Youtube, Dropbox, etc. These projects are trying to become a more equitable version of their centralized counterparts. Their goal is not to be controlled, governed, or censored by anyone, unlike their respective predecessors who are unilaterally controlled by the management of their respective company. Users do not have any rights in the centralized version, while each user in the decentralized can have rights through the ownership of the respective tokens.
The fact that the concept is familiar, with today’s centralized representations with a huge user base, makes it easy to adopt decentralized ones. For example, Youtube is the most viewed video content platform and cloud storage is already among the largest industries in the world. Therefore, it is easy to convince an ordinary man on the street to just move on to “the best version”, rather than trying to educate and convince ordinary people to accept new and abstract concepts on which they are based. most blockchain projects, which most people have a hard time understanding, let alone adopt.
Ordinary people are also aware of how much companies have grown in the sharing economy business. Google, owner of YouTube, and Amazon, a leader in the field of cloud storage, have a market capitalization of more than $ 1.5 trillion each. Of course, although YouTube and Amazon Web Services do not contribute 100% to the profits of both companies, they do control a significant part of the business. YouTube’s ad revenue was 11% of Google’s total revenue, while AWS accounted for 57% of Amazon’s total revenue last year. Therefore, these projects have the advantage of having a precedent. The value of listed entities such as Google and Amazon can be used as a guide to estimate the potential value of the decentralized version of YouTube and AWS. Therefore, investors have visibility into such projects, making them more willing to invest, making such projects gain value earlier than other more abstract projects
With Coinbase and Grayscale making these tokens more accessible to investors, more people will be able to invest in these projects, which will likely increase their value even more over time. Investors new to crypto assets may be more willing to invest, as these projects have proposals that they already understand.
Realizing that the new Google and the new Amazon could be born from these projects, investors are hoarding the tokens of these sharing economy platforms. In the wake of increased demand, another exchange platform has gained a lot of attention. BTT, the native token of the popular peer-to-peer file sharing protocol BitTorrent, has seen a steady 500% recovery in March.
While the huge percentage increases in a short period of time may seem excessive at first glance, the gains could be sustainable as these projects are still greatly undervalued compared to their centralized counterparts, even after these large price increases. The combined market capitalization of the 5 tokens mentioned above is just under $ 20 billion, while the combined value of Amazon, Google, and Dropbox is 3 trillion and rising. If these projects really take market share away from their centralized listed peers, investors could generate returns of 100x to 1000x from them, which means that it is not too late to enter yet if one is a medium to long-term investor.
About Kim Chua,Principal Market PrimeXBTAnalyst:
Kim Chua is an institutional trading specialist with a track record of success that extends to major banks including Deutsche Bank, China Merchants Bank, and more. Later, Chua launched a hedge fund that consistently achieved triple-digit returns for seven years. Chua is also an educator at heart who developed her own proprietary trading curriculum to pass her knowledge on to a new generation of analysts. Kim Chua actively follows crypto and traditional markets closely and is eager to find future trading and investment opportunities as the two very different asset classes begin to converge.