While a lot of crypto traders and investors were forced to endure a torrid time during the bearish trend of last year’s market, not every influencer of the crypto space suffered the same fate, according to a recent report by Bloomberg.
Picks and Shovels
During the greatly popular period of the ‘Gold rush,’ many endlessly sought to get gold to trade; a sure way to wealth. Why it is easy to suggest gold miners were the easiest best to get rich, it wasn’t so. The ones who saw a need in the get-rich-frenzy were the one to get rich quick instead.
“A gold rush is a perfect time for you to enter the pick and shovel business,” Mark Twain.
The crypto rush frenzy which hit a frantic height in 2017 has taken the world by storm as people increasingly consider digital currencies as a better store of value. However, a year after the influx saw digital currencies falling as low as 90 percent of their previous highs, and carving losses in various investments.
Bears Are Sweet Generous Things
Unlike the general downtrend of most parties involved in the market last year, a recent study by Bloomberg has shown that not all crypto companies were at loss.
While companies such as Bitmain and its ilk were forced to lay off some of its staff, companies which built infrastructures, invested in equity investments and were not as directly involved with the virtual assets themselves reported a significant rise in profit.
Konstantin Richter, CEO of a blockchain firm that creates and hosts blockchain networks, Blockdaemon, explained why ‘picks and shovels’ companies did well even in a trying period. Because of the negativity of the market, Richter observed, companies had to turn to blockchain companies for expert improvements rather than rely on marketing and flowery talks. He said:
“This is the most productive phase we’ve ever been in. That’s because various efforts in the space need to deliver on their ambitions and are turning to firms like Blockdaemon for help. Projects now need to show their colors. The time is up of raising a lot of money and talking a lot of talk.”
A similar company, Macol.la which is a Los Angeles based investment, advisory and recruiting firm also decided to make equity investments rather than invest in Initial Coin Offerings (ICOs). According to its founder, Sheri Kaiserman, the epileptic manner of the cryptocurrency market and the severe bear, late last year is only a good indicator that they made the right choice.