Between 2018 and 2020, there has been an estimated decrease of 35% in the blockchain market. The researchers predict a new momentum for Blockchain investments by 2023.
According to a recent study by global technology market advisory firm ABI Research, income related to blockchain investments has fallen by 35% between 2018 and 2020. The report indicates that the potential loss amounts to USD 2,800 million.
The researchers consider that the coronavirus pandemic is one of the causes. They believe that the spread of the virus has had a significant negative impact on investment opportunities. This may have affected the desire to develop new blockchain-based apps.
They also talk about the influence of the cryptocurrency market on the decline in profits. They mention that the fall in prices in late 2018 “eliminated 80% of the total aggregate market capitalization.” They explain that this led around 2,000 projects with crypto assets to disappear and “significantly reduced the adoption of blockchain in other markets.”
However, the company believes that this drop in income will be short-lived. For that reason, they predict that the market may return to the 2018 income levels by 2023.
The researchers expect interest and demand to drive income for blockchain apps focusing on manufacturing, transportation, warehousing, and retail trading over the medium term. Their forecasts are similar to the calculations that firm KPMG made.
In August 2019, this company published a report indicating that investments in blockchain had reached an all-time high of USD 128,000 million in 2018. During the first half of 2019, they observed a drop in investments, which reached USD 38,000 million.
The latest research from the market intelligence firm International Data Corporation (IDC) shows more encouraging statistics. They expect global blockchain spending to close 2020 with an increase of at least 50% compared to 2019. They estimate that investments in blockchain solutions will amount to USD 4.1 billion this year.
New Momentum for Blockchain in Post-Coronavirus Era
According to the analysts from ABI Research, current successful business use cases will be ready to take advantage of the new momentum phase in blockchain investments. They anticipate that this will happen within about three years.
ABI Research’s director of digital security research, Michela Menting, said that “the coronavirus pandemic has impacted on selected blockchain apps. The most affected are those connected to the supply chain management and the medical and healthcare supply logistics.”
The executive mentions some problems related to the health area that they have successfully addressed with blockchain. She refers to the apps that they use to share timely, relevant, and authenticated information about the pandemic.
This position of the ABI Research board coincides with the estimates of Colombian specialist Manuel Acero. He considers that the use of blockchain could be “a light at the end of the tunnel” in the post-coronavirus era.
Acero said that blockchain is useful for incorporating improvements in the food and pharmaceutical chains, and in the management of controlled work environments. He added that the implementation of blockchain registries, smart contracts, and devices for the Internet of Things (IoT) in supply chains will be essential in post-coronavirus periods.
By Alexander Salazar
