In a recent address at the London Blockchain Conference, Lars-Jacob Boe, Senior Partner at Bain Norway, emphasized the transformative influence of blockchain technology on traditional financial institutions, ranging from banks to governmental bodies. Boe asserted that executives in the banking sector globally must grapple with four pivotal queries regarding the advent of Web3 and its potential repercussions.
In delineating the progression from web1’s focus on information to web2’s emphasis on communication, Boe elucidated that web3 revolves around the exchange of value, contributing to the completion of the Internet in a decentralized, peer-to-peer manner devoid of intermediaries. Within this framework, digital assets, encompassing cryptocurrencies, central bank digital currencies, and tokens, stand out as a paramount focal point for financial institutions.
Despite the rapid expansion and acceptance of blockchain technology, Boe observed that the transition to web3 and blockchain integration remains relatively limited in certain sectors such as advanced manufacturing, energy, healthcare, and the public sector. Conversely, financial services and technology companies are at the forefront of blockchain adoption, actively seeking disruptive opportunities.
Boe underscored the imperative for banking executives to swiftly acquaint themselves with a slew of novel concepts, including blockchains, NFTs, DeFi, digital wallets, dApps, digital currencies, digital tokens, DAOs, and the burgeoning Metaverse. He emphasized that although these technologies are in their infancy, a tipping point is imminent, signaling a significant inflection for blockchain and web3 technologies.
Anticipating substantial market growth, Boe highlighted that the average digital market assets cap in 2021 stood at approximately $1.8 trillion, with projections indicating a potential surge between four to eight times in the mid-term. Looking further ahead, he predicted increased governmental adoption of blockchain technology, with multiple Central Bank Digital Currencies (CBDCs) and use cases for stable coins, alongside the coexistence of digital tokens and traditional securities.
Boe contended that the forthcoming mass adoption of blockchain technology would be propelled by factors such as a maturing regulatory environment, rapid technological evolution, endorsement from institutional and private investors, and an influx of capital. Notably, he cited estimates from HSBC and Northern Trust suggesting that 5-10% of assets could be tokenized by 2030, translating to a staggering $15 trillion to $30 trillion in digital assets within the next seven years.
