By Mehran Muslimi on The Capital
According to a new study by CB Insights, blockchain tech has gone far beyond its beginnings in banking and cryptocurrency, with annual global spending on blockchain applications has almost tripled since 2017. Furthermore, CB Insights’ Market Sizing Tool predicts this annual spending could shoot up to $16 billion by 2023.
As the report says, everything from insurance and gaming to cannabis and industries are seeing the potential power of blockchain. The big companies, such as Facebook, Amazon, Samsung, and LG have already dipped their toes in the water, and LG has introduced it using a “Facial recognition service that combines AI and blockchain to make payments in digital currencies,” according to Luke Fitzpatrick in Forbes.
What does blockchain give to industries? According to Ilker Koksal, it provides:
And which industries will benefit the most and see the biggest changes by using blockchain applications? Here are the four most likely to make the most of blockchain.
Digital banking has made great progress over the last decade and decentralized finance (DeFi) could be a catalyst for taking banking fully digital. Atul Khekade, cofounder of XinFin said, “The FinTech industry is growing at the rate of 23% year-on-year and blockchain is about to make finance more efficient.” He expects to see traditional finance firms and governments understanding the advantages in the near future, and it is almost certainly the case that countries with large numbers of unbanked people will take advantage of blockchain solutions. If they aren’t already, they should be.
Supply chains and logistics
While banking has been the most prominent user of blockchain, industries that rely on the supply chain sector are also embracing blockchain with good reason. As Fitzpatrick says, “The technology by its very design offers an unprecedented level of efficiency in the recording and tracking of goods,” and this didn’t go unnoticed by IBM for tracking goods. Carrefour, a French supermarket, has also used the technology for the tracking of food products from farms to stores.
Fitness and wearables
Wearable technology had already made big consumer inroads, and the Covid-19 pandemic has increased interest in wearables that monitor steps, heartbeat, and calories consumed amongst other things. Herbert Sim, an advisor to BeFaster said, “The fitness is gaining momentum over the past 10 years. According to forecasts, in the US alone, the income of the fitness industry by 2023 will exceed 20 million.” The need for social distancing has also led to new app creations for tracking. Allan Zhang, the founder of DxChain said, “Post-lockdown, the technology could be fully embedded into the wearables industry and this will provide immense value to customers in the long run.”
Fitzpatrick says, “According to a recent study, artificial intelligence, distributed ledger technology (DLT) and the blockchain technology will have the biggest impact on asset investments in the upcoming years.” The industry is already valued at $74 trillion. Ernst and Young (EY) said, “Asset managers need to proactively consider valuation challenges arising from the COVID-19 pandemic’s effect on financial markets.” Yubo Ruan, a 23-year-old venture capitalist, said, “Pragmatically, this means financial products like ETFs and mortgage-backed securities can be synthesized on blockchain platforms at significantly lower costs,” adding, “ blockchain-based asset management platforms tend to require lower minimum balances to invest, which is a major positive for adoption.”