Latest Trends in Blockchain Technology
Blockchain is a breakthrough technology that has disrupted the world and will continue to do so. It has a ripple effect on industries including Banking and Finance, Automotive, Healthcare, Media & Entertainment, Insurance, Retail, Telecommunications, Travel, and Transportation. Blockchain is estimated to reach remarkable growth, from $11.54 billion in 2022 to $162.84 billion by 2027, according to a market report by Statista. So, it won’t be wrong to say that blockchain technology is poised to transform the nature of trades and transactions worldwide.
So, in this blog, we will look at the latest blockchain technology trends that will take the market to the next level.
An Overview of Blockchain Technology
While some of us are pretty aware of blockchain technology, others might still associate it with cryptocurrencies. To make it easier for you to understand, let’s dig a little deeper into what blockchain technology refers to and why it is popular in so many industries.
Blockchain is a digitally shared, immutable ledger that allows businesses to track assets and record transactions within their network. Anything of value can be tracked and transacted over a blockchain network. In simple terms, it provides an advanced database mechanism that enables transparency while sharing information in a network.
Blockchain consists of a continuously increasing list of records or blocks linked in a chain using cryptography. Each block in the blockchain network consists of a timestamp, cryptographic hash, and transactional data. And the data in a blockchain network is chronologically consistent, i.e., it will not allow anyone to modify data without a general agreement between all the parties involved.
Growth in Blockchain Market
Before we dig into the blockchain trends, it is crucial to know how much growth blockchain technology has seen over the past few years, and if you can expect it to gain more traction in the future.
Some of the essential stats that you should know are:
Back in 2018, the size of the blockchain market worldwide was $1.2 billion, has now reached 12.7 billion US dollars, and by 2025, it is expected to reach over $39.7 billion, according to a report from Statista.
Moreover, worldwide spending on blockchain projects and solutions by 2024 is expected to reach 19 billion dollars.
In 2018, the market size of blockchain in financial and banking services was 0.28 billion US dollars which are projected to reach approx. 22.5 billion dollars by 2026.
According to Globe Newswire, the blockchain market will rise at a 56.3% CAGR and reach 163.83 billion USD between 2022 to 2029.
The blockchain market which was reported to value at $4.9 billion in 2021 is expected to reach 67.4 billion USD at a CAGR of 68.4% around 2026, as suggested by the Markets and Markets report.
The venture capital funding for blockchain startup companies has reportedly surpassed the value of $25 billion last year, according to CBInsights.
No doubt bringing that much uproar, blockchain technology will continue to gain a lot of anticipation. Blockchain technology has been gaining traction in multiple sectors due to the promise of safer, transparent, and more efficient transactions for different use cases.
Top 7 Blockchain Trends You Must Know About
What are the latest trends in Blockchain Technology? The ones which will be on the latest trends in blockchain technology are:
Central Bank Digital Currencies (CBDC)
Although you might have heard about most of them, what do they bring to the table? Let’s find out!
Despite being around since 2014, NFTs gained momentum in 2021. With NFTs, one can have ownership of digital or physical assets. NFTs evolved around the blockchain and ERC-721 standard to confirm the user’s right to these assets. Simply put, NFTs are unique cryptographic tokens on a blockchain representing real-world objects such as real estate or artwork. What makes NFTs popular is their ability to remove mediators, streamline transactions, and create new opportunities in the market.
Even though NFTs have discovered some promising use cases in music, art, gaming, fashion, and the real estate market, their potential exceeds far beyond the initial use cases that are grabbing the attention of more artists and audiences.
2. Central Bank Digital Currencies (CBDC)
CBDCs have the potential for the most persuasive innovations in the fintech space that will impact all the stakeholders in the industry. Central Bank Digital Currencies are digital tokens like cryptocurrencies issued by a central bank and peg the value of a country’s fiat currency.
While cryptocurrencies are decentralized where their price is linked to fiat currency like the U.S. dollar, CDBC can become the fiat currency, i.e., the digital version of cash that the central bank issues.
Besides, over 95% of the global GDP is exploring CDBC, and 50 countries including Jamaica, Nigeria, South Korea, India, Russia, Japan, etc. are in the advanced phase of either pilot, development, or launch. With such fuss in the market, CDBCs have brought, it won’t be wrong to say that it will be in trend in the upcoming years.
For the one who is unknown about BaaS, it is a cloud solution based on the concept of software-as-a-service (SaaS) that will allow businesses to develop, and operate blockchain apps and other relevant functions. BaaS acts like a web host that runs backend operations for a blockchain app. Besides, BaaS providers will ensure the agility and operability of the infrastructure.
According to a report, the global market size of blockchain-as-a-service (BaaS) is expected to reach 24.94 billion USD at a CAGR of 39.5% by 2027. Given that, soon, we are about to witness the wide-scale development of BaaS platforms and firms.
Metaverse is the current discussion within marketers, analysts, and technology companies as the next big thing that is going to alter our lives. While ‘meta’ in the term refers to beyond, ‘verse’ means universe. Metaverse is an immersive virtual world with tremendous financial and social potential.
With the emergence of digital technologies like blockchain, machine learning, augmented reality (AR), virtual reality (VR), cloud, IoT, etc., it has become possible to create the “Metaverse” that was once a novel concept in Neal Stephenson’s science fiction Snow Crash, 1992.
Simply put, a metaverse is a virtual, 3D universe developed by using multiple virtual spaces and technologies, allowing users to enter the digital universe using virtual IDs as avatars and access the spaces in the metaverse for hanging out, shopping, meeting their friends as they did in the real world from the comfort of their home.
No single vendor owns the virtual space in the metaverse, since it is device-independent and collective. Moreover, cryptocurrencies and non-fungible tokens (NFTs) are used to make transactions in the metaverse spaces.
So, this year we can anticipate more active involvement in Metaverse from big tech companies that will accumulate more attention from different audiences across the globe.
Decentralized Finance (DeFi) services use the power of public blockchain networks and smart contracts to provide globally available financial services like lending & borrowing, asset exchange & swap, StableCoins, prediction markets, spot trading, insurance, etc.
The concept of DeFi had emerged as a safe and authenticated way to empower digital economy potential. Today, we can find a vast range of blockchain-based solutions dealing with financial activities to ensure strategy transparency and fund security.
So in the upcoming years, we will witness the continuous evolution of DeFi security and safety protocols to detect malicious and unwanted intrusions in the decentralized apps (DApps) before they can operate and damage the core infrastructure network. Moreover, crypto like SOL, ETH, and DOT will help in enhancing security and scalability for the users.
And most importantly, the DeFi market size value is expected to reach 1431.54 billion USD by 2030 at a CAGR of 85.9% according to Grand View Research.
6. Green Blockchain
One of the main setbacks for blockchain was the immense amount of energy used, increasing the level of carbon emissions. To avoid that, blockchain developers will focus on introducing eco-friendly blockchain solutions by using new approaches like carbon offsetting, a remedial measure for the removal of carbon dioxide emissions.
Other than that, reducing the energy consumption of blockchain models can also help in creating a green blockchain. Companies will achieve this by going from the Proof-of-Work model to the Proof-of-Stake consensus model. In short, the development of green or eco-friendly blockchain will be at the forefront of blockchain trends.
7. Ricardian Contracts
A Ricardian Contract was initially introduced in 1995 by Ian Grigg. It has now become an essential part of the blockchain. These contracts are forms of digital documents that act as an agreement between two or more stakeholders on the terms and conditions for interactions.
Ricardian Contracts are human-readable legal documents that once agreed upon and signed by the parties involved, get converted into a machine-readable contract, defining their intentions and actions. It uses a cryptography hash for signature and verification.
The main difference between smart contracts and Ricardian contracts is the agreement type, i.e., while one (Smart) executes whatever is defined as actions in the contract, the other (Ricardian) records the agreement between multiple parties as a legally valid contract.
That being said, there is a high chance that Ricardian contracts will replace smart contracts in the future. Why? Because the Ricardian contract legally binds the involved parties into a contract and executes the actions according to the agreement, making blockchain transactions more secure and transparent.
Undoubtedly, blockchain is one of the most advanced technologies that offer better security, transparency, accessibility, and immutability of data. And as we have seen in this blog, the blockchain industry will continue to evolve at a breathtaking pace. Also, it has moved beyond its initial use case of cryptocurrency and is now being used by different industries for a plethora of use cases.
Some of the latest trends in blockchain technology that we will witness include the continuous evolution of DeFi, growth of eco-friendly (green) blockchain, empowerment of metaverse, increased demands of BaaS, NFTs, and Ricardian contracts, and more.
You can also experience the benefits of trends in blockchain technology by innovating your product with the help of top blockchain developers in the industry. To achieve that, all you need to do is get in touch with our experts who will help you in the development of your blockchain project.