Which FAANG Will Win the Blockchain Wars?

For investors, blockchain and FAANG are two magic words that can move markets. Mere association of a stock with those two words can make a stock seem more attractive. (See also: Riot Stock Rallies As Blockchain Tech Goes Mainstream.) 

Investor enthusiasm for blockchain and FAANG is due to their future bullish prospects. Even as FAANG dominates the internet ecosystem, blockchain is set to reinvent the internet and its associated services. Here is a brief primer on how each of the FAANG companies is preparing for the blockchain future. 

Facebook Inc. (FB) 

Facebook recently announced a high-profile reorganization, moving prominent executives from successful product lines, and placing them into positions of authority within a newly formed blockchain group. David Marcus, who previously headed the company’s successful Messenger services, said the intent of his “small group” was to “explore how to best leverage blockchain across Facebook, starting from scratch.” (See also: Facebook's Bad News. Good News For Blockchain?)

The threat to Facebook stems from an inversion of its current business model, where it makes money by selling user data to advertisers. A blockchain world envisages users who have personal control of their data and choose to share it only with parties that they trust.  It is still a while before that future comes to pass. According to Spencer Bogart, a venture capitalist at Blockchain Capital, blockchain is not “an existential threat to Facebook today”. But it might become one in the future. “That’s why they [Facebook] want to be smart and stay engaged,” he said.   

Google (GOOGL)

According to reports, Alphabet Inc.'s subsidiary Google plans to use blockchain for securing customer data on its cloud services. The idea is to have a white label version for companies to use on their servers. Google has also invested in blockchain startups through its venture investing arm Google Ventures (GV). The companies in GV’s portfolio comprise a diverse palette. For example, crypto wallet provider LedgerX is one of their investments as is bank transfer company Ripple. As with Facebook, it is still too early to quantify the impact of these investments on Google’s bottom line in the near term. 

Amazon.com Inc. (AMZN) 

Amazon competitor Walmart Inc. (WMT) made news last year when it announced a supply chain implementation of blockchain last year to enable customers to determine provenance of its consumer goods. It would seem that Amazon has taken a different route. The Seattle-based company launched AWS Blockchain Templates in its cloud service recently to deploy frameworks for ethereum and Hyperledger on its cloud platform recently. The offering is part of its plan to offer Blockchain-as-a-Service (BaaS). Competitors to Amazon in this arena include International Business Machines Corp. (IBM) and Oracle Corp. (ORCL). (See also: All About Amazon's New Blockchain.)     

Apple Inc. (AAPL) 

The iPhone maker has been characteristically silent regarding its blockchain moves. But Coindesk discovered a patent filed by Apple last December that makes use of blockchain technology to create timestamps. In its patent application, the company said that blockchain technology can be used to build resilience in a distributed system of elements, such as a SIM or MicroSD card. The timestamps are part of a “multi-check architecture” system proposed by Apple. Timestamps will be verified by another system before they are added to the main chain. (See also: Is Apple Planning to Use Blockchain?)

Netflix Inc. (NFLX)   

Of all the companies within the FAANG group, Netflix is, perhaps, most threatened by blockchain. The video-streaming company has not made any announcements regarding investments in blockchain, but the drumrolls for its demise due to blockchain have already begun. A popular post by Rizwan Virk earlier this year outlined a scenario where a decentralized platform using blockchain technology could get rid of the centralized architecture and traditional gatekeepers of the content business. While it has displaced cable and disrupted linear television viewing habits, Netflix is still the gatekeeper to content on its platform. As such, content makers still need its stamp of approval before their content can be viewed. In the decentralized world, content makers and technology entrepreneurs will be able to make and stream their own content on a subject of their own choosing. The token model could also upend existing business models by making it possible to purchase individual shows with tokens on an entertainment network.

Investing in cryptocurrencies and other Initial Coin Offerings ("ICOs") is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or other ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns 0.01 bitcoin. 

Take the Next Step to Invest
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.