How Cryptocurrency Will Affect Digital Marketing

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Crypto request: How Facebook’s Libra coin will affect marketers

Written by: Action Digital

It was only a matter of time. After Bitcoin exploded in the mainstream back in 2020, the global market was ripe for the introduction of a cryptocurrency that had all the allure of not being regulated by a central authority yet safe enough to be a reliable form of transaction.

On June 18, the tech juggernaut announced plans to launch its own blockchain technology powered cryptocurrency, named Libra. Facebook was not alone in this endeavor; in a bid to lift the cryptocurrency technology from the Erebus of the Dark Web to the commercial heights of the mainstream, Facebook announced that it will partner with 27 more organizations (including Visa, Paypal, Uber, Mastercard, Spotify, and others) to form a non-profit organization called Calibra that will be based on Switzerland and will handle operations for Libra. The hope here, of course, is to utilize the clout of these global companies to sway public opinion and act as a subliminal guarantee that -unlike all the other cryptocurrencies- Libra is safe to use.

Whether this new business venture succeeds or not is irrelevant; social media and cryptocurrencies were bound to meet at some point in digital history so marketers need to be prepared for the day the two are intertwined.

One social media platform to rule them all

David A. Marcus, the project head for Libra, was clear in his many interviews after the cryptocurrency was announced: Facebook will not be running Calibra but instead have the same rights as every other partner. Marcus had to assure people that this was the case, as the image of company CEO Mark Zuckerberg testifying before the US Congress regarding the Facebook – Cambridge Analytica data scandal will be forever burned in everyone’s mind. Facebook was caught playing fast and loose with user data far too many times to have any sort of credibility when it comes to protecting people’s private information, but one has to approach a critical mass of naivete to believe that Facebook will let any competitor get in with Libra.

Facebook will be the only major social media platform associated with this cryptocurrency so marketers need to really educate themselves on how the Facebook advertising algorithm works, how to provide content for optimal reach and how to execute campaigns that could be solely limited to this platform. Having a baseline knowledge of Facebook and treat like all other social media will not be enough: you need to become an expert on Facebook marketing first and foremost; the others can wait.

It’s a microtransaction world

Libra’s chief function will be to allow the transfer of money from your digital wallet without any of the fees banks usually apply. Integrating that wallet with Facebook will change the way goods are marketed and sold. Libra will initially be used for everyday transactions on Messenger and Whatsapp but the bigger picture is not hard to see. With over 90 million businesses currently on Facebook, the possibility of completing the buyer-seller cycle without ever leaving the platform isn’t an impossibility anymore.

Hey, you like this cool t-shirt? No need to visit our site and go through the arduous registration process! Where you will be forced to put in your credit card information and fill in these personal information details. Because seriously, who DOES know their zip code without looking it up? Just click this nifty “Pay with Libra button” here and the t-shirt is yours! Where to ship it? No worries, we have that information from your Facebook account. And if we have any questions, we can always call you on the mobile number you provided for a two-step identification! Hey, did we tell you about this amazing vacation package from our sister company?

As microtransactions more than doubled the gaming industry revenue in 2020, this function is expected to cause product sales to skyrocket. Marketers need to make sure that when the big wave comes, their clients are riding the surfboard.

Remapping the UX

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The ability to instantly purchase means that marketers need to completely rethink the user experience. Where previously the goal was to guide users seamlessly towards buying the product, now the focus should shift more towards making an amazing first impression. An impression so good that the user would immediately be convinced to buy the product on the spot. Micro-moments -these intent-rich moments when decisions are made and preferences shaped- moments when marketers expect users to look up certain topics and products, will be more important than ever and identifying those micro-moments will be the key to unlock success. Anticipating a need and catering to it will be the most important challenge for marketers.

A single identity

New Yorker cartoonist Peter Steiner once said, “On the internet, nobody knows that you are a dog”. The shroud of anonymity has always been an issue, as right now users are more skeptical than ever when dealing with people online. Many tried to solve this but none succeeded: users either gave false information or chose to not divulge personal information out of fear of being hacked. So the problem remains: How do you make sure that people are who they say they are?

Facebook might have a solution. In the white paper on the Libra coin, the authors included two lines that immediately raised eyebrows:

“An additional goal of the association is to develop and promote an open identity standard. We believe that decentralized and portable digital identity is a prerequisite to financial inclusion and competition.”

It is apparent that the tech giant will somehow push for a form of internet -therefore global- identity through its use of Libra coin. This does make sense. If one deals with an actual person then one is far more willing to engage.

But how does a global identity affect marketers? Facebook will need a way to signal that this person is who he/she says he/she is, which could be achieved through some sort of verification badge. Which of course means that the influencer culture will be more important than ever, on every single step of the marketing process. Product reviews? Just imagine the impact they will have if the buyer can actually see that these are real people and not hired contributors or bots. Or what kind of loyalty an online store or product would inspire if the buyer knew exactly who he/she is dealing with every step of the process. If Facebook manages to propose some form of global identity to go with the Libra coin, full transparency will become extremely important. The more the user knows about the company and its people, the more likely he/she will be to engage.

Be prepared for new markets and audiences

The World Bank’s 2020 Global Findex Database identified 1.7 billion people in the world as “unbanked”, meaning that they do not have an official bank account. What is more surprising though is that out of those people, 1 billion has internet access and is on Facebook. During the launch of Libra, Marcus stated that the organization’s first goal is to allow “the unbanked” to have a reliable money keeping and transfer option.

It would be a mistake to outright believe that these people don’t have bank accounts because they don’t have bank access. While this might be the case for many, most just don’t trust banks to carry out transactions or don’t want to pay bank fees for transfers. Libra coin will not only bring these people into the banking and marketing fold but also the multitude of those who have bank accounts but are skeptical towards traditional banking institutions. Marketers will need to develop an arsenal of buzzwords to advertise to these people and adjust their strategy to address their concerns over data protection. Breach of personal information will be a major point for people in general, so familiarizing with GDPR best practices is paramount.

Here at Action Digital, we are experts on digital marketing in general and social media in particular and unlike Zuckerberg, we don’t hold grudges! Not sure how to react to the never-ending shifts in the digital marketing field? We got you covered.

How Today’s Stock Markets Crash Will Affect Cryptocurrency Markets

Over the past few days, and particularly over the past 24 hours news on Wall Street has gone from hyper-optimistic to downright depressing. One article declared we’d come to “The end of the market’s Trump honeymoon”, others are analyzing not whether or not major correction…

Images like this infamous one from the 2008 financial crisis have started to appear in bearish articles.

Over the past few days, and particularly over the past 24 hours news on Wall Street has gone from hyper-optimistic to downright depressing. One article declared we’d come to “The end of the market’s Trump honeymoon”, others are analyzing not whether or not major correction is underway, but whether or not the correction will lead to a “multiyear bear market”. The change in sentiment is startling, and it’s been almost perfectly mimicked by the crypto market. Watching this play out has caused two questions to arise: firstly how strong the correlation between traditional financial markets and the cryptocurrency markets is and secondly if the correlation exists what the implications of today could be for cryptocurrencies.

The Correlation Question:

Disclaimer: This part of the article gets a little technical.The tl;dr here is while the correlation between the markets themselves is weak, there’s a noteworthy correlation between the sentiments of the two markets. I explain the implications of that correlation in the section following this one.

While many, many attempts have been made to qualitatively correlate crypto markets and even imply causation (a big no-no in quantitative analysis, relatively few attempts have been made to quantify the relationship. Aside from a few outdated articles, I’ve found little. The best resource I was able to find on the subject was Sifr Data, a free cryptocurrency data visualization tool. Among other visualizations, they have a cryptocurrency correlation matrix which shows the z-scores and p-scores of correlations between various assets.

For those of you who skipped statistics class as much as I did, the numbers in the first chart are called z-scores. They represent the direction and strength of the relationship between the two sets of data. A higher absolute z-score means greater correlation, while a lower absolute z-score means less of a correlation. Whether the number is positive or negative indicates whether the relationship is direct or inverse:

The S&P 500, because of it’s z-score, has a “weak positive relationship” to Bitcoin. This is hardly interesting and according to our matrix is not statistically significant (check out the link for an explanation of why). Now let’s look at the VIX z-score, the other number I mentioned above. It’s a -0.31 making it a “moderate negative relationship”. For those unaware VIX is an index of the volatility in the stock market and is also referred to as the “fear-gauge”. This means that there is a definite inverse correlation between VIX and Bitcoin. This was demonstrated quite well in an article earlier this year which contained the following graph:

This is an extremely interesting find. If true, it means that as fear in markets decreases bitcoins price increase. Conversely, as fear increases bitcoins prices decrease. This makes Bitcoin a risk-on investment as opposed to more conservative investments like gold which are considered risk-off investments.

It also tells us that in a longer-term bear stock market cryptocurrencies will likely fare even more poorly than their stock counterparts. Conversely, in a bullish market, they will likely fair better.

The Correlation Plays Itself Out

With this correlation in mind, let’s analyze the recent market trends which have caused this rise in the VIX (up 115% today) and try to figure out what’s going on here. Today, the Dow Jones dropped 1,175 points constituting the single largest point drop in the measures 130+ year history. Nonetheless, because of the recent meteoric rise, percentage wise it only constituted a 4.6% drop. To give a measure of what this means for the markets, we can simply say that the Dow Jones has reversed all gains made in 2020. This alone, while bearish, is definitely still consequential. Unfortunately, the Dow Jones wasn’t the only index hurting today with the DAX (based in Germany), FTSE (based in the UK), and S&P (based in the US) all down sharply over the past few days. Looking at this combined with cryptos own 45% fall in recent weeks, you can see why the VIX is climbing and fear is driving the market.

What’s causing all this? Everyone has a theory, but there have been two rather nerve-racking causes. First of all the Federal Reserve’s 10-year yield rate, which determines the interest rates the U.S. government and Americans pay on their debt has increased recently. Higher interest rates can lead to decreased consumer spending and can increase inflation, both rather bearish signals. This combined with some rather prominent economists/former Fed Chairman (I’m looking at you, Greenspan) declaring that we’re entering a “massive multiyear bear market” have driven VIX through the roof. In the world of crypto, this fear mongering is combined with the recent price fall, crypto’s notoriously panicky retail investors, and general FUD and you end up with what could become a long bear market.

I hope I’m wrong, and maybe I am. Hope is probably the best I can do. As we now know: market sentiment, more than anything else, drives the price of cryptocurrencies. I anticipate an interesting few weeks ahead of us.

Disclaimer: The views expressed in the article are solely that of the author and do not represent those of, nor should they be attributed to CCN.

Featured image from Shutterstock.

Last modified: January 24, 2020 11:16 PM UTC

Jake Sylvestre is the founder of PhishTrain, a board member on Projectile X (which manages YBC) & a cybersecurity expert who consults for Fortune 500 companies on topics like cybersecurity, blockchain, and marketing. Follow me on Twitter: @jakesyl Jake Sylvestre is also the host of The CCN Podcast

How quantum technologies will affect cryptocurrency: what Google doesn’t say

A document announcing Google’s achievements in quantum computing has appeared on NASA’s official website. Emphasis was put on the fact that technologies are threatening the crypto industry. The document has been deleted, but analysts attribute the report to the further decline in Bitcoin’s rate. In this review, we’ll observe what fate awaits the cryptocurrency market and what awaits people in the future.

Quantum computer vs. usual computer: which is better?

To understand why a quantum computer is powerful, we need to understand what makes it work. To analyze information, quantum computers use quantum bits instead of binary digits (qubits). Traditional computer data bits are present in only two states: zero (0) or one (1). These are “on” and “off” states. The quantum bit is in a superposition state. In other words, it has several meanings at once. Thanks to quantum bits, computers quickly store and process large amounts of information. At the same time, these machines use less energy than classic computer models.

The processors of such machines are 100 million times more productive than those of modern computer models are. Power will grow in accordance with a double exponential function, increasing every year by billions of times.

Cryptocurrency and quantum technologies: Private account holders in danger

Developers of blockchain technology have made cryptocurrency transfer secure. The main purpose is the protection against account hacking and counterfeiting of user data. All transactions are recorded in blockchain, and no one can simply change the processes of this system. The users who participate in the transfer can see everything. Quantum technologies cannot affect blockchain: the system will continue to run flawlessly.

However, they can be dangerous for personal account holders and cryptocurrency wallets. To send a payment in ETH, for example, the user enters a 64-character key (a combination of letters and numbers). If attackers want to get ETH, they enter a similar combination. The difference is that a regular computer cannot calculate it, and a quantum one can do it easily.

Protecting blockchain from quantum technologies

One question worries blockchain enthusiasts and traders: when it will happen. Experts have predicted that in 5 years, quantum technologies will already be threatening blockchain and cryptocurrency technologies. Nevertheless, Vincent Danos, chief researcher at the French National Research Center, said in an interview that this could be discussed no earlier than in 20 years.

There is still time, but there are two ways to deal with the threat today:

  • create private keys instead of prime numbers factorization. In this case, even the most powerful computer will not be able to find the available options.
  • use private blockchains instead of public counterparts. One will need to be verified by the network author to gain access.

Both options will help to reduce the risk of quantum computer developers’ negative actions.

3 bold Predictions of the Future: Where Geordie Rose was mistaken

Any phenomenon has both advantages and drawbacks. And it’s not just about the blockchain threat. Geordie Rose, CEO of D-Wave Systems, gave a public lecture on quantum technologies in 2020.

At the end of the speech, Rose stated that there are three bold predictions concerning the field of quantum computers:

  • NASA scientists will find a planet with an Earth-like atmosphere. After that, companies will start discussing how to move to this planet. According to the director of D-Wave Systems, this should have happened in 2020.
  • Confirmation of the theory of the parallel reality. It will happen in 2023.
  • Developing machines with human intelligence that replicate human activity. It will happen, if we are to believe Geordie Rose, in 2029.

Therefore, even though we have to postpone the theory for more than three years, Rose’s first prediction is partially correct. A certain planet was discovered by NASA’s Kepler space telescope back in 2020. There may be liquid water on it. However, the scientists have not yet provided the exact answer.

The third point is particularly interesting because human analysts view quantum computers as human substitutes. The main drawback here is the disappearance of several professions: driver, translator, financial analyst. In 2020, the robot waiters served people at the Japanese cafe. However, people with disabilities controlled the work of these waiters. In 2029, we will find out whether quantum computers will replace people.

The benefits of quantum technology development

Quantum technology is an effective tool for dealing with a large number of modern problems in the world. One of the main areas is medicine.

  • Improving the effectiveness of antibiotics. The problem of the XXI century – the resistance of bacteria to drugs – remains relevant. However, thanks to the use of quantum powers, it can be mitigated. Quantum computers will also simplify the process of selecting drugs for specific situations. Doctors will be able to see how this or that drug affects the body without any risks. It will help to improve medications for the treatment of complex diseases.
  • Diagnosis of cancer at the early stages. Every sixth person in the world dies from this disease. The main problem is the complexity of early diagnosis: some types of tumors are visible only at a late stage. Quantum technologies will help the doctor to find carcinoma at the primary stages.

Quantum computers will improve the data transfer system, making it as secure as possible. Moreover, they will contribute to science, allowing scientists to minimize the time needed to calculate important data.

One thing can be said for sure: the development of quantum technologies will change our life dramatically.

How Cryptocurrencies Affect the Global Market

Whether you have a personal stake in FinTech or are looking for ways to invest in cryptocurrencies, there’s no denying that its emergence has affected the global trade market in significant ways. According to data published by Leftronic, 78.95% of cryptocurrency owners bought their coins, while the rest mined them personally, with 19% of people worldwide having traded in crypto in some capacity before 2020. Bloomberg also reported that about 70% of all crypto trading is done by Asian traders, with currencies such as Tether, Bitcoin, Ethereum and Litecoin leading the charge in daily trading volume.

How has the cryptocurrency market grown so much despite the neglect of global trade institutions and traditional banks? What are some of the most significant changes and innovations brought on by cryptocurrency when it comes to the global market? Let’s take a look.

The Importance of Cryptocurrencies in Today’s Global Market

It’s important to discuss the essential benefits of delving into cryptocurrency trade in today’s market before we tackle the changes these currencies have brought to the scene. In essence, cryptocurrency revolves around digitally-mined, digitally-traded currencies whose values vary depending on their ICO project and popularity. Pat Madison, Head of Finance at Top Essay Writing spoke on the matter: “There’s no denying that cryptocurrencies have permanently changed the way we perceive FinTech, fundraising and digital trade at root level. Integrating crypto trade features into online services and e-commerce platforms should, in my opinion, be the next big push cryptocurrency makes on the global level.”

It’s worth noting that cryptocurrencies are not just a passing trend and that people see real value in their use in exponentially larger ways. Some of the most obvious ways in which crypto can make your trade activities more convenient and secure include but are not limited to:

  • Low barrier for entry and increasing potential for ROI
  • Safe, transparent and streamlined trade thanks to blockchain ledgers
  • Wallet-based trade ensures the privacy of your personal data unlike traditional banking
  • Decentralized trade market which doesn’t rely on any country or banking institution

Cryptocurrency and its Effects on the Global Market

1. Disruption of Traditional Currencies

Once cryptocurrencies became more prevalent in the trade market, established currencies such as US Dollar, European Euro and British Pound took a backseat in the eyes of the public. Individuals who opted to invest in crypto trade rather than a traditional stock market brought worry to the table of many traditional banking institutions which thought that their dominant place on the trade stage was secured.

Cynthia Brook, Chief Financial Officer at Classy Essay spoke on the topic recently: “With the emergence of cryptocurrencies, consumers and investors suddenly had a bright new market to pay attention to. This has created ripples in both governmental and banking institutions which aim to reign in and control crypto trade within their territories for years without success.” As we’ve stated, the decentralized, ICO-based nature of creating and trading cryptocurrencies makes it impossible for any institution to control its influx efficiently, disrupting the traditional financial system and forcing it to adapt to modern consumer needs at a rapid rate.

2. Emphasis on Digital Trade

Speaking of adapting to new trends, digital banking has shown no signs of a slowdown in recent years thanks to cryptocurrencies and their standards making their way into traditional banking. With smartphones and affordable data packages being more and more available worldwide, consumers have turned their attention to flexible mobile banking, digital transactions, and on-the-go accessibility.

This has prompted banks and FinTech institutions to ensure the quality of life features for their clients via dedicated mobile banking apps – a move directly inspired by cryptocurrencies and their initial idea as a digital-only trade solution. As a result, traditional, brick-and-mortar banking establishments have minimized their HR requirements, streamlined transactional activities and continue to develop new digital trade features for their clientele in the hopes of retaining them under their brand’s umbrella.

3. Emergence of Blockchain Technology

We’ve touched on the fact that cryptocurrency trade is managed by blockchain ledgers – an online data management system that ensures transparency and safety of each coin’s transaction. This technology has slowly but surely found its way into a plethora of industries such as medicine, finance, and technology to name a few. Michael Simpson, Head of Organizational Development at Be Graded spoke highly on the matter: “Whether you are a retail business or a strictly online venture, blockchain tech can significantly upgrade your data infrastructure going forward. Its developmental flexibility and potential for further refinement allow developers to constantly find new ways in which to complement its functionality to day-to-day operations of their businesses.”

Blockchain allows developers to elevate their business’ backend data infrastructure and create a more detailed and easier-to-manage informational system. Many traditional banking businesses have also found use in blockchain technology even though cryptocurrency, the innovation which brought the technology to the forefront in the first place, remains their top contender.

4. Growth and Investment Potential

Lastly, the cryptocurrency market, unlike its traditional banking equivalent, is in a constant state of innovation and development in terms of new currencies. ICO projects based on a variety of technologies and services sprout on a constant basis; making is very easy and straightforward for new investors and early adopters to jump in on their favorite new currency. Chief Executive of Financial Department at Subjecto put it this way: “Whether you have a lot of capital available or want to try your hand at trade and financial management for any reason – cryptocurrency exchange is the place for you. From high-risk-high-reward currencies to more long-term investments with growth potential, crypto has something to offer for anyone interested in its global market and emerging technological innovations.

The disruptive nature of cryptocurrencies goes against the established notion of traditional banking which has prompted FinTech institutions to make stock trade and investments easier in recent years. However, they have a lot of ground to cover if they aim to compete with crypto and the sheer scale and versatility of its global market and growing audience in the coming years.

The Future is Digital (Conclusion)

From a lowered entry barrier to digital banking innovations and blockchain emerging in a variety of industries across the world, cryptocurrencies made a permanent mark on the global market and continue to do so it a daily.

Whether from an outsider’s perspective of curiosity or someone looking for ways to invest in crypto, you can rest assured that the market has something to offer for anyone willing to give it a chance to showcase its potential. Only time will tell what the future holds for traditional banking institutions and their treatment of crypto going forward but one thing is for certain – the technology and its effects on the global scene are here to stay for good.

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