According to new research published by Grand View Research, the decentralized finance (DeFi) sector has been estimated to reach $231.19 billion in 2030 at a compound annual growth rate (CAGR) of 42.5%. The global crypto market is currently capped at close to $1 trillion from its peak of $3 trillion last year during the market boom in November.
DeFi Growth is Fueled by Increasing Interest in Technological Innovations
The research found that increasing adoption of blockchain innovations, technological advancements, and appetite for digitalized financial services are some of the major factors driving the growth of the DeFi market size.
In 2021, the market was estimated at $11.78 billion, and it’s expected to jump by more than 20x by 2030 due to the degree of transparency and real-time settlement of financial transactions on DeFi protocols.
North America Leads the DeFi Market
According to the study focused on the global, regional, and country participation in the DeFi ecosystem, North America is leading the market with a share of 34.9% recorded in 2021.
The dominance, however, can be attributed to prominent crypto firms such as the decentralized exchange UniSwap and lending protocol Compound Finance, located in New York and San Francisco, respectively, offering their goods and services to consumers in the region.
UniSwap recorded a new milestone in transaction volume in May. After four years in business, the exchange crossed the one trillion dollar mark in cumulative trading volume.
Aside from the major crypto platforms across the nation, North America also has one of the biggest crypto-related asset markets in the space.
Although the country dominates with a 34.9% share, Asian Pacific is expected to experience explosive growth in CAGR over the predicted period.
Last month, YouGov and Visa investigated 14 markets and found that 21% of Asia Pacific consumers had previously interacted with DeFi protocols. According to the survey, the Asian market is anticipated to increase by 17%, with 38% of consumers interested in using DeFi services for the first time in the next six months.
Smart Contracts and Payment Segments to Witness Massive Growth
The Grand View Research noted that smart contract and payment segments are anticipated to witness significant growth in the coming years, with a high CAGR in 2030. Smart contracts have advantages since they are automatically built into the blockchain to keep track of transactions made visible for public consumption, bringing transparency.
On the other hand, the payment segment growth can be ascribed to the decentralized nature of DeFi protocols, its borderless nature, and the lack of intermediaries to control the payments.
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