Bitmain, one of the largest bitcoin mining hardware manufacturers has announced that it plans to invest in a number of startups that are looking to create blockchain-based central banks. The announcement was made by Jihan Wu, the co-founder of Bitmain. The announcement was part of a keynote address he delivered at the DC Blockchain Summit being hosted by the Center for Financial Markets and Policy department of Georgetown University in collaboration with the Chamber of Digital Commerce.
The Summit brings together some of the key figures in the blockchain industry for a series of panels and discussions about the major issues and accomplishments within the industry.
During his address, the Bitmain co-founder stated that the company maintained a keen interest in private central banks powered by blockchain technology. He declared that Bitmain was looking at potentially investing in about 20 to 30 startups that are developing these blockchain-based central bank infrastructure.
Wu is of the opinion that blockchain central banks would fare a lot better at creating a customer experience that was more convenient than their fiat-issuing counterparts. He declared that such banks are, in fact, critical to the unique emerging economy.
Jihan Wu also went on to say that private central banks powered by blockchain technology have the potential to become lucrative business ventures. He based this prediction on the fact that a central bank has always proven to be a profitable business.
The Bitmain co-founder expressed confidence that private blockchain central banks can be just as successful as their fiat-issuing counterparts. He drew particular attention to the Fed Reserve and the considerable revenue stream that the bank earns.
He asserted that a private blockchain that could issue cryptocurrencies and set it aside in a legal way can become a highly profitable business especially within the context of the growing cryptocurrency market.
Bitmain’s ambition to invest in private blockchain central banks is another indication of the company’s drive to increase its operations in the crypto market. The company is also reportedly looking into investments in artificial intelligence as well as an expansion of its mining activities in Canada.
On the subject of the cryptocurrency market as a whole, Jihan Wu said that it was difficult to predict which currencies will drive the much talked about cryptocurrency market consolidation. During his address, he disputed the notion that the market would eventually coalesce and condense around a few crypto species.
He based his objection to this theory on the dynamic nature of the market, pointing out that a number of cryptocurrencies are experiencing enormous growth in price and market capitalization.
He drew attention to the decline in bitcoin dominance due to the rapid growth of other cryptos like ether and dash. With such a trend, he believes that the market will continue to evolve rather than consolidate on a few cryptocoins.
Wu also declared that are no “perfect cryptocurrencies” which means that investors, traders, users, and other market participants will always have a catalog of choices open to them. The absence of any perfect cryptocurrency that can address every single need in the market opens the door for other cryptocurrencies to exist.
Feature image by Kasia Bojanowska