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World Economic Forum: Blockchain Could Disrupt $867T in Traditional Markets

  • Posted On - 2021-05-08 10:18:18

The opportunity could be substantial for an already fast-growing crypto industry with a current market capitalization around $2.3 trillion.

All assets will eventually be tokenized, from stocks to bonds to commodities. That’s the perspective of many crypto prominent who predict that most of modern finance will eventually run on digitally rather than traditional by just putting it on the blockchain as it is.

As explained in the report from the World Economic Forum, the organization whose annual meeting in Davos, Switzerland, has been, at least prior to the coronavirus pandemic, a venue of choice for the global financial and regulatory establishment. 

“Many anticipate a future blurring of the lines between traditional publicly listed equities and tokenized private company shares,” says the report.

Report further goes, “While greater digitization is inevitable, substantial headwinds may continue to limit adoption of distributed-ledger technology solutions, including limited leadership buy-in and uncertain business cases, the need for significant restructuring of business operations, challenges relating to bridging legacy systems with new solutions and perceptions about regulatory uncertainty.” 

Apparently the most remarkable thing in the 100-page report is the length to which the authors go in estimating the potential size of the traditional markets that might be on the rise for disruption. 

In all, it works out to $866.9 trillion: 

  • Equity markets: $95 trillion

  • Debt markets: $106 trillion

  • Securitized products: $10 trillion

  • Derivatives: $560 trillion

  • Securities financing: repurchase agreements $4 trillion, securities lending $2.9 trillion

  • Asset management/fund administration: $89 trillion

The opportunity could be substantial for an already fast-growing crypto industry with a current market capitalization around $2.3 trillion, according to coinmarketcap, a leading crypto aggregator.