Top 5 Future Potentials Of Blockchain Technology
Blockchain technology's real-world use cases such as faster
cross-border payments, identity management, smart contracts, cryptocurrencies,
and supply chain – blockchain technology is here to stay and become the next
innovation just like the Internet. There have been attempts to formulate
digital money, but they weren't successful due to security and trust issues.
But blockchain needs no central authority, and its operations are controlled by
people who use it. Plus, it can't be modified or forged, causing a massive hype
and demand in the market. Blockchain has moved past cryptocurrency and
discovered implementations in other real-life applications; that's where we can
expect Blockchain technology to be simplified and not remain a complex concept.
As more companies realize how blockchain can benefit them,
they'll reserve more resources, money, and time into the technology, and
millions of use cases will emerge. Today, this blog discusses the top future
trends for blockchain technology that will dominate the world in the year 2022
and ahead.
1. Central Bank Digital Currencies – a new chapter in the
national legal tender
With the rising popularity of cryptocurrency over the past
few years, the notion of digital currencies being adopted as legal tender is no
longer a far-fetched concept. Several countries have already set the wheels in
motion to introduce their digital currency, also referred to as Central Bank
Digital Currencies.
Such currencies are envisaged to function in tandem with
conventional legal tender. The main reason many countries are considering
national cryptocurrencies is that they can enable governments to benefit from
the enhanced security and transparency of transactions, which could lead to a
decline in financial fraud. In 2021, El Salvador adopted Bitcoin as legal
tender, and the UK government has already endorsed Bitcoin to be developed in
2022. The trend of Central Bank Digital Currencies is projected to be adopted
by more nations in the next few years, including China, Japan, and Russia.
2. Non-fungible tokens (NFTs) – a horizon beyond just art
2021 saw the rise of Non-fungible Tokens (NFTs) as the
latest application of blockchain technology. These unique digital tokens were
initially popular in art, with artists launching their NFTs to an excellent
response, including Beeple, The Kings of Leon, and Grimes.
However, NFTs have swiftly moved much beyond the artwork.
Now NFTs are increasingly gaining prominence in fields such as sports and
gaming. For instance, the popular game Axie International has applied the
concept of NFTs to enable users to use their own NFTs as participants in the
game. Non-fungible Tokens have also been used in the world of fashion, with
international giants such as Nike, and Dolce and Gabbana launching NFTs for their
footwear and clothes, respectively. In 2022, more sectors like real estate are
likely to jump aboard the fascinating NFT bandwagon.
3. Blockchain and IoT – a match made in (digital) heaven
In a world ruled by gadgets and the Internet of Things (IoT),
it is no surprise that security and integrity are major concerns for users.
This is, arguably, the main driving force behind the collaboration between
blockchain technology and IoT.
Since the central premise of blockchain technology is the
seamless creation and maintenance of clear, chronological, and unchangeable
records of digital transactions, it has seemingly limitless application in not
only machine-to-user transactions but also machine-to-machine ones. With the
continued incorporation of 5G technology worldwide, the usage of blockchain in
tandem with IoT is expected to address concerns around the security,
scalability, and transparency of transactions.
4. Blockchain technology – towards a greener and cleaner
future
One of the main arguments against the usage of blockchain technology is its adverse impact on the environment. The higher the application
of this technology, the higher is the consumption of energy and the
corresponding carbon footprint. This dark hue of blockchain technology prompted
Elon Musk to stop, at least for a while, the acceptance of Bitcoin as payment
for Tesla cars.
With the ever-rising consciousness of our role in reducing
our respective carbon footprints, 2022 is slated to be the year when blockchain
technology becomes greener and cleaner. In a pioneering step, Ethereum has
already announced plans to switch to a Proof-of-Stake model in its blockchains
to reduce the harmful impact on this blue planet. This year is also expected to
be the harbinger of using renewable energy sources in blockchain technology.
5. The Metaverse – from science fiction to reality
Gone are the days when the Metaverse existed only in science
fiction, and our only idea of virtual reality was the parallel universes that
unfolded in Mad Max and Star Wars. Giants in the
technology sector have already expressed interest in
investing time, money, and resources in exploring and developing the Metaverse
and its applications across a wide variety of industries. Facebook and
Microsoft are some organizations that are leading the way in this trend.
The application of blockchain technology in the Metaverse
can lead to a higher degree of decentralization and enhanced transparency, and
easy access for users. In 2022, several new projects applying blockchain
technology in the Metaverse are expected to add more intrigue yet more clarity
to the Metaverse.
Countries like the USA, Canada, Mexico, the UK,
Germany, France, China, Japan, Australia, India, Brazil, Saudi Arabia, and UAE
are heading the charts to leverage this emerging technology's potential. And
according to a Gartner report, we can see a market size of USD 10 billion by
2022. By 2025, blockchain business value will grow to over $176 billion and
increase to $3.1 trillion by 2030. These numbers show how blockchain technology
will be a force to reckon with, and soon, the world will leverage it in their
everyday lives.