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DatChat (NASDAQ:DATS) released their IPO on 13th August for $4.15 per share. The DatChat share price is now around $7.50, up 80%, and they hit a high of $9.13. The innovative idea and investor backing has helped the stock do well. But we believe this is only the start.

DatChat

DatChat Inc. is a blockchain, cybersecurity, and social media company that not only focuses on protecting your privacy on your devices, but also protecting your information after you have shared it with others. They are developing a privacy platform that will be powered by a decentralised global messaging and digital rights management blockchain. The concern surrounding data protection is ever growing. Whether that is protecting yourself against companies after your data or individuals. Some features that DatChat have are: anti-screenshot, encrypted images, zero tracing whilst still being fast and easy to use. They are also looking to develop features such as pinning posts, advanced moderation and prioritised notifications. These will help DatChat challenge other platforms such as Discord regarding large group chats, whilst also competing with WhatsApp for individual messaging.

Why the need for security?

Recent years have seen WhatsApp and Facebook receive criticism about how they use their clients data. In July 2019, it was announced that Facebook was to be fined $5 billion by the Federal Trade Commission due to its privacy violations. In October 2019, Facebook agreed to pay a £500,000 fine to the UK Information Commissioner’s Office for exposing the data of its users to a serious risk of harm. We’ve also seen Apple prioritise security more and more, even using it as a main marketing strategy for new products. All of these give a good indication of the increasing demand for personal security.

Blockchain

Blockchain is growing and is being adopted by many sectors due to its security, namely the finance industry and crypto. How may it prove to be so beneficial for a social network? “Blockchain security is a comprehensive risk management system for a blockchain network, using cybersecurity frameworks, assurance services and best practices to reduce risks against attacks and fraud” quoted IBM regarding the field. “Blockchain technology enables decentralization through the participation of members across a distributed network. There is no single point of failure and a single user cannot change the record of transactions.” DatChat is one of the first to accommodate Blockchain in a social network.

What is the value of DatChat?

DATS is the future of social media. Although it is cheaper now, what is its worth as an investment to you? Another company that was ahead and reinvented one aspect of social media was Snapchat, which now has a market capitalisation of $110B. Match.com is another social media company that is valued at over $40B. At this time, the DatChat share price gives a market capitalisation of $128M. So although they are just starting out, it is easy to see the potential of this sector when a company brings something new to the table.

In the short term, double digits is in sight. I wouldn’t be surprised to see $20 by the close of the year. But also the long term potential of this stock is amazing and the risk is minimal at such low prices. With a 42% short interest, once this stock makes a move, you’ll be too late to the party.

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