Specialists and researchers in innovative technologies were serious when they forecasted a bright future for blockchain. They said that the technology would become mainstream, and for the most part, those predictions have been materialized in 2019.
A recent report published by tech market advisory company ABI Research concluded that the global revenues for blockchain technology are expected to hit $10 billion by 2023, which is an astonishingly high figure that shows just how much the industry has grown and how much room for improvement there is currently.
Venture Capital Funding: Proven Success
ABI states that investments in the blockchain industry will continue to increase, despite the reduced popularity of the once-hot initial coin offerings or ICOs. The primary explanation of the projected revenue numbers in the next four years is the venture capital (VC) funding blockchain infrastructure development.
According to ABI, venture capital is essentially replacing ICOs as a mean of funding blockchain projects. In 2018 alone, a total of 620 funding rounds totaled approximately $3.1 billion, an increment over the 153 rounds at $850 million in 2017.
Reasons to Look Beyond ICOs
According to the firm’s blockchain and Digital Security Research Director Michela Menting, “tighter regulation (including securities) and taxation (as foreign currency, income, financial asset, etc.) on cryptocurrencies in a number of countries are prompting investors to look beyond ICOs towards more stable VC-based investment for blockchain startups focusing on support infrastructure, retail, supply chain and enterprise applications.”
The blockchain technology is now a viable solution for real-life issues. Project administrators, government officials, banks, sport teams, startups, tech firms, shipping companies, universities, and other ventures are looking at blockchain because of its benefits, which include trust and transparency.
However, and despite the fact that they show amazing revenue numbers, blockchain apps outside the insurance and finance industries are currently struggling because of, according to reports, the absence of a middleware class of blockchain offerings and products that successfully link with applications from startups.
Do not Fear the Crypto Winter
Despite the aforementioned scenario, ABI thinks that those offerings will start to flourish from 2021 on, when platform agnostic components start gaining steam over the currently-implemented platform-locking services. The specialist observed that she does not think the crypto winter will have a negative effect that will drag for an extended period of time.
“While the crypto-winter has dampened spirits somewhat despite successful completion of many pilots, the dip in enthusiasm is temporary and will serve to filter out the superficial and fraudulent offers from the market,” she explained.
According to recent reports from specialized crypto news sites, Algo Capital has raised $200 million (two times the projected amount) for its VC fund, in the latest example of the success of this particular form of funding. Similarly, the first half of the year was filled with successful VC funding rounds that helped blockchain projects to hit their goals and start developing helpful tools with everyday use and potential.
By Andres Chavez