Mitch Steves, a research analyst at the Royal Bank of Canada (RBC), believes blockchain technology has a potential of a $10 trillion ecosystem.
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“While the cryptocurrency space has many risks, the opportunity appears vast with constant technology updates,” Steves said.
Companies offering exclusive services to transact payments have received the most attention in the space thus far, but Steves claims the protocol layer these services utilize will ultimately end up being the most valueable.
“We see that the protocol layer will capture more value than the applications,” Steves said.
“As the application becomes successful, the protocol layer captures more value, which then creates more interest in additional decentralized application development.”
The report also mentions the $6 billion market for bitcoin mining equipment, stating the cryptocurrency mining market is still in its development stages.
Many risks regarding the space were brought up including scalability, potential government regulations, and advanced hacker techniques that have made some wallet services susceptible to cyberattacks.
“As scaling and protocols mature, the value of a decentralized world computer could potentially become a multi-trillion dollar industry,” Steves stated.
“If there’s one positive technology item we can agree on, it’s that the blockchain has never been hacked. What happens if we build on top of this secure layer?”