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According to estimates from the Bank of America, If one assumes 2 percent of the world’s servers utilize the blockchain, the blockchain sector would eventually be a $7 billion market.
A $7 Billion Opportunity
As reported by CNBC on Oct.3, the rising blockchain market represents a multi-billion dollar opportunity for tech corporations like Amazon, Microsoft, and others. BoA researcher Kash Rangan made the claim after analyzing currently-used mechanisms in supply chain operations and cloud computing, and he believes utilizing blockchain could help make the two fields more efficient and transparent.
Rangan believes Amazon’s supply chain-intensive business model would highly benefit from implementing a blockchain system, making its retail operations more efficient. In addition, the company’s famed AWS cloud services would benefit from the security and immutability that blockchain-based backends provide.
Stating the reasons for a $7 billion valuation, Rangan assumed just 2 percent of the world’s computing systems to operate a blockchain, considering an average cost of $5,500 per server per year. However, the analyst remains mum on when such a radical change could take place, as the technology remains obscure in traditional markets.
Explaining blockchain technology to his clients, Rangan stated in a note:
“Blockchain is a software protocol that underpins cryptocurrencies like bitcoin. Also called distributed ledger technology, it shares data on a distributed, secure, and unalterable ledger in a way that “databases have not been able to in the past.”
Evangelizing Enterprise Blockchain Adoption
Last week, American retail giant Walmart announced the use of blockchain technology in a real-world setting, becoming one of the first retailers to deploy the tech in parallel to existing infrastructure. As stated in a release, Walmart said it would track lettuce from suppliers and require them to upload data about several variables on a blockchain-based application once a year.
Rangan evangelized the “blockchain-as-a-service” (BaaS) term, a play on “software-as-a-service” (SaaS) that thousands of businesses around the world specialize in. The analyst stated the former could be used in enterprises for protecting customer data and providing transparency until retail applications for the technology are developed.
Apart from the companies mentioned earlier, Rangan said blockchain technology would greatly benefit IBM, Salesforce.com, Oracle, and real estate players and mortgage businesses like Redfin and LendingTree. However, the BoA researcher stated while a “wide range” of blockchain uses can be imagined, the technology’s “money-making ability is still unproven.”
“Many blockchain use cases have been identified, but full products/services have not yet been built and are not used in production,” Rangan concluded.