‘NFTs will create new monetization models‘
What’s the basis of Web 3.0 market predictions, what’s driving the market, and should we be immediately hopping on this train, explains the Israeli blockchain expert Meirav Harel:
“By introducing NFTs, there’s a possibility of a new revenue model for tech giants and other companies, startups, and end-users. These are next-generation NFTs that have a lot of potential to create solutions to real-world problems“, says Harel.
Research Companies: The Web 3.0 market is expected to reach $163 billion by 2030.
Many market research companies gave their opinion about the future of Web 3.0. At first, it may seem suspicious that their data differ on certain points. What’s important is that they agree on the overall market estimation in 2030, with blockchain expected to reach $81 billion.
For example, in their May report, Emergen Research stated that Web 3.0 was worth around $3.2 billion in 2021. With a 43.7% CAGR, the market is expected to reach $81.5 billion by 2030.
On the other hand, the overall market value is significantly lower, according to Grand View Research. Their data shows that Web 3.0 value was $1.73 billion in 2021. Moreover, it’s forecasted to grow by $33,5 billion. However, both reports agree on the CAGR of 44% in the period 2022-2030.
Photo Illustration: Freepik
We tried to understand why these indicators changed paths. First, both of these reports rely on available data from 2019/20 and consider the same regions. So, this discrepancy may lie in the fact that they surveyed different companies. Considering the market size, it’s actually logical that data slightly differs. But what’s inevitable is that the market will grow at this rate.
To prove this point, we’ll cite another extensive research from Fortune Business Insights. They mostly surveyed USA companies. Since this is the region with the most significant share, it’s obvious why their data shows a higher estimation than the previous two reports.
More specifically, their stats show the global blockchain market’s worth was $4.7 billion in 2021. The total estimation for 2029 will be an astonishing $163 billion. What’s more, the CAGR is forecasted at 56.3%.
The Hype behind Web 3.0
As far as we know, the decentralized nature of Web 3.0 perfectly responds to the current needs of internet users. That’s why it has contributed the most to its growth. When one digital area became demystified, users became aware of the importance of transparency when dealing with their privacy, cyber security, and sensitive data.
Photo Illustration: Freepik
From that point on, there was no going back to operating vaguely. Imagine having a bank app today that doesn’t give you a detailed insight into your account. Instead, it asks for your blind trust, no questions asked. Wouldn’t you immediately start feeling suspicious? Or look for another option, a more transparent one?
If there’s an option that could allow you to avoid the middlemen, even better.
And that’s the whole point of Web 3.0.
What’s Driving the Growth of Web 3.0
MRF’s study reported that North America will undoubtedly have the most significant market share in 2023. To be precise, it will account for 56% of the whole Web 3.0 market, with the USA accounting for 97.6%.
There are a few reasons why this region grew more rapidly than the rest of the world. By identifying them, we need to understand what’s driving the growth of Web 3.0:
- Blockchain adoption is growing exponentially
- Frequent innovations in decentralized ecosystems
- Continuous investing in cutting-edge Web 3.0 startups
The second largest market is Europe, with growing interest in BFSI, media & entertainment, IT & telecom. Furthermore, this is the 3rd largest market thanks to major companies in the Asia-Pacific region, with China accounting for a 57.1% share.
What all three regions have in common is the initiative to invest in 5G infrastructure. However, in all mentioned markets, the critical problem is fragmented markets relying on local players. Considering that, what could improve the existing Web 3.0 landscape is joining the strengths of established players and corporate and public investments in DAOs.
How will Web 3.0 Revolutionize Financial Transactions?
Web 3.0 has a vast potential to change the way we make financial transactions to our advantage. One of the best examples to understand this premise was presented by the CEO of an Israeli MHfintech, Meirav Harel, at this year’s edition of the Splet Tech Conference in Belgrade. She explained how companies can now create secondary markets:
“The new Alfa Romeo Tonale comes with NFT, which includes a smart contract with details about ownership, technical inspection, etc. What’s more, NFT allows the company to gain insight whenever the vehicle is resold and acquire royalties accordingly”, Meirav said.
Meirav’s lecture in Belgrade. Source: Splet Tech Conference Facebook Page
Another good example is a plane ticket. If you purchase tickets a year in advance, you’ll get them for an excellent price. But if you wait until the day before, the ticket price will be ridiculously high. That’s why somebody came up with the idea to purchase them months in advance and resell them later for a reasonable amount. Not only that, but much cheaper when compared to official websites. The best part is it’s a win-win situation for everyone.
Well, the ticket comes with NFT, which means it’s unique. When you purchase it, the information about the transaction is sent to the original source. In this case, that’s an airline company. Once the company is informed, it can receive royalties for that purchase.
This process is a clear example of how airline companies would receive profit thanks to NFT, which would otherwise be unavailable to them. Therefore, the company is satisfied, the reseller has gained profit, and you, as an end user, are also relieved because you saved money on the ticket.
The Benefits for End Users
One of the most important purposes of NFTs, as Meirav Harel said, is solving the world-heavy disequilibrium that exists right now and is related to the monetization of data.
Who creates data? Each one of us. How do we create it? Just by existing. Who makes money from this data? Tech giants. When you stop and think about it – we're creating data and somebody else is making money from it. That doesn’t make sense. Something is wrong with this model.
Photo Illustration: Freepik
This idea of somebody else making a profit from users’ data has troubled those who advocate for decentralized ideology. But, until now, there wasn’t a solution to this problem.
“We just saw the NFT hype because they were touching only art. Suddenly, a whole new world can open regarding keeping track of data ownership. And that is where Web 3.0 comes into the picture. Web 3.0 companies dealing with this disequilibrium and trying to find proper ways that each of us has a wallet so that our data is collected for ourselves. We can then decide to whom we want to sell the data and receive royalties every time that data is used. We, logically and ethically, should have our own basic income based on something we generate, even by walking, breathing, or talking to others. And that is the ideology of Web3″, Harel explained.
In other words, every internet user should have ownership over their data. Not only that, but we should also gain insight into when our data is sold to agencies or other entities. The user would then be entitled to an income based on that transaction because he generated the data in the first place.
In addition, Meirav emphasizes that these technologies could significantly impact power structures and that humanity should decide the future direction.
“Some countries have not evolved in the last 200 years because they prefer stability. But we should ask ourselves, is stability our goal? Or is making things more efficient, fairer, and more valuable to all sides a goal that would justify creating all those new solutions and innovating more and more? The previous two web generations had the best intentions, but now let’s do it in a way that’s fair so that it gives opportunities to more people and more companies”, she concluded.