Partnerships: A Buzzword, But What is Behind It?
In a bearish market, projects often come up with news of partnerships and foolproof use cases.
There are more than 1,500 digital assets listed on CoinMarketCap, each with their promises of unique use cases. But because most projects are slow to release a beta version of their product, the next best thing is the announcement of a partnership. The effect is, sometimes, a temporary rise in market prices. But looking closer, those partnerships look much more like a buzzword than a real-life use case.
Partnership with BMW
One of the most recent partnerships announced came from VeChain (VEN), one of the hot new Asian startups. The project aims to use the Internet of Things and distributed ledger solutions for tracking goods. Recently, the project announced BMW USA would be one of its partners. But the nature of the partnership is very superficial: the project would just use and link its system for testing to the BMW Car Data interface.
This is by no means an exclusive partnership, as others may link their technology with no need for approval by the company. And the case of VeChain is not the only one. A recently released token, CarVertical (CV) has been sliding after an overhyped “partnership” of a similar type.
Partnership with Microsoft
Nothing looks like a stamp of legitimacy compared to the tentative approval of the influential software giant. In that case, too, many projects have taken creative license with the meaning of the word “partnership”. True, Microsoft has shown interest in Bitcoin, as well as some blockchain technologies, offering developers tools to build blockchain solutions. However, there are no known exclusive partnerships.
The most high-profile case is that of IOTA, which later apologized for the misunderstanding. But the damage was done.
Other cases of partnerships with Microsoft should almost always be seen as a buzzword and hype. Simply using the Azure cloud is counted as a partnership. But the cloud solution is open to anyone.
Amazon: The Holy Grail of E-Commerce
Because a lot of coins are aiming to become a means of payment, any mention of the online retail giant helps. The most recent hype concerns Verge (XVG), although it is unknown why a giant like Amazon would not be able to purchase 75 million XVG, instead of asking the community and whales to donate:
Unfortunately, in most cases, the only thing in common is the possibility to buy a limited amount of gift cards using crypto coins. The cards are distributed by third parties, and Amazon never handled any coins directly.
The connection to Amazon trading has been suggested for the Ripple (XRP) project. A similar form of hype was created for Ripple by mentioning a usage on Uber. So far, those were only rumors. Additionally, using Amazon’s computing services does not represent an exclusive partnership.
Sometimes, a bank partnership merely means that a bank has agreed to support accounts and services for a crypto company. But the most ambitious case of bringing banks on board again belongs to Ripple. For now, real-world use cases are in the testing stage. And banks have a separate supply of XRP coins, hardly resorting to the open market. The hype that Ripple would displace the SWIFT system caused the price to spike briefly above $3 before sliding back again.
For now, the real-life application of Ripple has to wait, and most banks are only testing the distributed ledger.
Alibaba and TRON
The recent price spike of TRON (TRX) could be traced to a tentative connection with Alibaba. However, TRON is very far from providing payment or record-keeping solutions to the Chinese retail giant.
Whether the partnership materializes or not, the TRX market price moed up as the markets were in the red, up 33% this week to around $0.044, marking a recovery from recent lows.
But some believe the partnership with Alibaba may also trivial, concerning minor technological compatibility. Similar rumors of a partnership have surrounded Monetha (MTH). Waltonchain (WTC) has also spiked immediately after achieving a real partnership with Alibaba, though not in retail, but in a smart city project.
Real or Fake?
In the short term, both real and tentative rumors of a partnership may move the coin or token price. But those news need to be taken with a grain of salt, especially if the price is overheating. Impulse buying may leave hopeful investors holding a stagnant or rapidly depreciating assets.
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