Venture capital investments are generally reserved for the big investment funds as they are usually the only ones who can afford to allocate a big sum of money to a developing startup. Not to mention waiting for years to see if it turns out successful and brings any profit. However, this situation seems to be changing thanks to the new technology available.
Blockchain is a protocol created in 2008 to provide secure means of transferring data directly between two parties. Its usage is not limited to financial operations, but it’s most commonly found in cryptocurrencies, which have enjoyed great popularity in the last few years. Even though it’s a decentralised system, it guarantees security thanks to the public ledger in which every transaction is visible to all users.
Blockchain in venture capital
Blockchain-based startups are not only a popular option for investments funds to put their money in, but they also started to change the way the VC market operates. One example of this is the VNX platform. It aims to democratise investing and open the market to people with smaller financial resources. On the VNX marketplace, tokenized VC assets are traded, providing liquidity to the big investors and allowing them to diversify their portfolios.
Technology creates opportunities for ordinary people to invest in venture capital and brings more transparency to the market. With the increased number of people involved in the investing process the funds available also increase giving growth possibilities for more companies.