For Wall Street, there’s big opportunity beyond Fintech
Expected Industry Growth Over the Next Decade May Lead to Greater Blockchain Business Value to Take Note Of
It seems whenever the word “blockchain” is mentioned, people tend to assume that fintech is the focus of conversation. Truth is, it really shouldn’t be if you consider there is greater potential for blockchain business value in areas such as identity management, healthcare, hybrid cloud, and retail/e-commerce.
Let’s be clear, fintech is a very promising target area for alpha, both within and beyond the Wall Street community. In fact, it could be north of a $100bln market if you assume a similar CAGR through 2030 as seen over the past 5 years using data from Statista. The role of digital ledgers can by and large be used to better maintain a log of trade executions. This is extremely value-added when considering improved compliance, regulatory oversight, and of course greater procedural efficiencies. However, in a world with an increasing number of digital assets, the greater emphasis on security, digital identity, and the removal of the man in the middle (i.e. bankers, traders), presents new and exciting opportunities. This wide road of intrigue and possibilities has already begun to convince established Wall Streeters and entrepreneurs alike to grab the bull by its horns — the horns of modern opportunity. This has resulted in employment shifts away from traditional banks and into cryptocurrency and blockchain startups. Why take such a gamble on largely unproven technologies you ask?
For starters, blockchain is slated to be a $2 Trillion market by 2030 (up from $2.5 Billion last year). Greater global emphasis on security, decentralization, efficiency, and personalization are collectively helping to drive that opportunity at an unprecedented rate, and thus far it’s been pretty amazing to witness.
Beyond fintech, numerous start-ups are building applications to leverage blockchain technology in healthcare, insurance, advertising, supply-chain management, autonomous vehicles, IoT, and more. Additionally, there are a massive amount of customer facing distributed apps currently being built on “permissionless” systems (i.e. Ethereum). So saying that blockchain is ushering in Web 3.0 seems pretty on-point, especially in a growing world of digital integration within today’s society, something millennials and those comprising Generation Z (the initial generation raised in the smartphone era), are very much accustomed to.
Let’s be clear, blockchain is not meant to solve every problem in the world, but it can be used in ways still unimaginable, even to us who are in the space day in and day out. That makes blockchain something Wall Street should be looking to actually invest in, not just use. In fact, that may present the greatest hedge the gatekeepers of the financial markets should be establishing a long position in.
John Licata is CMO of MIMIR Blockchain Solutions, a Blockchain Systems Engineering and Design Lab.
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