Citi: what will bring the next billion blockchain users

Tokenization, web3 gaming, creator economy, and CBDC.

Investment bank Citi has recently released its new Global Perspectives & Solutions report, in which it makes the case that the blockchain is set to see a significant uptake in the next few years, thanks notably to these sectors 👆

Here’s the main logic behind Citi’s assumptions:

🔷 Tokenization: $4-5 trillion of tokenized securities and $1 trillion of blockchain-based trade finance volumes by 2030 🔷

Anything that carries value can be tokenized, i.e. assigned a token that will enjoy the seamless nature of blockchain transfers.

The global outstanding equity and bond market is valued at over $250 trillion, and Citi assumed that 1% of corporate and quasi-sovereign bonds, 7.5% of real estate funds, 10% of private equity and venture capital funds, and $1 trillion of securities financing and collateral activity will be tokenized.

The trade finance market could see around 8%-10% of its volumes tokenized by 2030.

🔷 Web3 Gaming: 50 million to 100 million gamers will adopt web3 games by 2025 🔷

In 2022, over 1 million unique active wallets connected to game DApps daily in 2022. It is not much, compared to over 3 billion gamers worldwide today, but with the advent of improved Web3 games, we could see the most active gamers move over to blockchain-based games.

🔷 NFTs unlock new revenue streams for content creators and consumer brands 🔷

Blockchain is a unique tool for providing trust and provenance, and the use of NFT allows content creators (artists, singers, dancers, fashion designers…) and consumer brands to connect directly with their fans or audiences.

A total of 3.8 million sale transactions of art and collectibles, worth $9.5 billion, occurred between March 2022 and February 2023, according to data from NonFungible.com.

🔷 CBDC: by 2030, CBDCs could have at least 2 billion users and over $5 trillion in circulation, and half could be using partly blockchain-linked models 🔷

This is the point where our and Citi’s views part ways.

While the CBDCs could indeed be pushed forward by major central banks, we firmly believe they have nothing to do with the blockchain. Even if some part of the tech behind them could be inspired by blockchain, the core, i.e. decentralized and censorship-free system, is designed to bypass a central authority, which obviously goes against central banks’ agenda.

Overall, this is a rather insightful report, which identifies the main development vectors of the crypto industry.