What Gives HBD Value: Investing And Funding
This is the fourth part in our series of what gives the Hive Backed Dollar (HBD) value.
There previous two sections covered:
Each of these areas carry with it multi-trillion dollar opportunities. This is something that HBD can take advantage of. If designed property, all serve as feeders into the value of HBD. Instead of trying to back it with collateral, the utility of the token negates that requirement.
In this article we will look at the feeder system for the entire global economy. Here is where we find the importance of investing and funding.
Raising The Standard Of Living
Money allows society to make economic progress. Through innovation, experimentation, and the advancement many different fields, the standard of living is raised. We can see clear evidence of this over the last 150 years.
The medium of exchange along with the store of value allows society to use money as the tool for the generation of real wealth. Once again, we define this as products and services people use.
Consider for a second how important the smartphone is to most people. This is a device that most cannot live without. Since the utility is so diverse, it is a major factor in people's lives. It is a lot more than our main communication tool. All kinds of business and personal matters are handled via this device.
Now think about all that went into the generation of that phone. Do not just focus upon the physical unit itself. We have to include all the different factors such as WiFi and mobile systems, support networks, operating systems, and a host of other mechanisms all designed around it.
We also have all the components which had to be designed, researched, tested, and developed.
What does all this take? Money.
There is little doubt the money spent on all these areas raised the standard of living for everyone using a smartphone. The investment that went in ended up providing a great deal more to society. In fact, it is impossible to calculate the impact since there are so many "soft" benefits.
Investing For The Future
One of the primary use cases for money is the investment for the future. This means that money is the tool required to ensure our future is more advanced than today.
Venture Capital is something most of us are familiar with. Here is where firms put together huge sums of money to back projects they believe in. This is a high risk game since the failure rate, especially in technology, is enormous. Firms involved in this arena tend to see a hit on 1 out of every 10 deals.
In 2021, Venture Capital money surpassed $300 billion. That shows how flush with funding these firms are.
At the same time, the US Government hands out more than $600 billion annually in research grants. Just these two sources along equate to more than $1 trillion in investing and funding.
Obviously, both these areas are highly centralized and deal in size. The average person is not going to be involved in anything like this. However, cryptocurrency promises to disrupt everything. Therefore, we should not overlook this realm as a potential use case for HBD. In fact, it is a vital part of providing a coin of this nature a store of value.
Here again, we see evidence of what helps to make the USD very difficult to destroy. When we look at the investing and funding realm, the majority of transactions occur via the USD. This is the mechanism that fuels much of the wealth creation.
There is a lot of discussion about the stablecoin market at the moment. This is something that is in its infancy so it makes sense that we have to analyze things for further development. However, we cannot mistake the fact that, even just using the two investment and funding sources mentioned here, we are going to need trillions of dollars worth of stablecoins.
When we look at the amount of USDC, as an example, we see that it has roughly 50 billion tokens available. This is not nearly enough to make any kind of dent into the existing system.
When trying to move society forward, we are now dealing with some huge numbers. SpaceX, for example, is expected to invest more than $10 billion in the establishment of Starlink. This makes sense since the US market alone is forecast to surpass $70 billion.
We all would agree that providing everyone on the planet with Internet access is a good thing.
It is also important to keep in mind that SpaceX also spends millions of dollars each time it blows up a rocket. This is done so it can collect data to learn how to stop blowing up rockets.
The point is that when we look at space, energy, communications, medicine, manufacturing, and agriculture, we see tens of trillions of dollars required to keep advancing society. There are some major problems we are trying to solve.
Again, if we understand that money is the medium of exchange that allows for this to take place, we see how the projects are just getting larger. None of this really takes into account the progression towards the Metaverse and all that will entail.
Here is the segment that HBD can really excel. When it comes to use case, investing and funding is an enormous sink. There are millions of great ideas worthy of pursuit out there. However, due to our existing system, most go unfunded. A coin like HBD can change that. By making it is a tool for this type of real world investing, we can see the utility skyrocket.
Of course, when we tie this to the ability to collateralize existing wealth along with a powerful payment system, we can see how this all makes for a solid choice.
What are your thoughts about adding this sink to HBD? Can you see how the utility generates the store of value? If we can build this, the appeal to those looking for funding will only grow.
Let us know your views in the comment section below.
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