A new report released by Royal Bank of Canada (RBC) recently pointed out that cryptocurrency, blockchain technology and decentralization are likely to become a $10 trillion ecosystem. Mitch Steves, equity analyst at Capital Markets, an RBC subsidiary, also optimistically analyzed the reasons for the decentralization of trading services in the future, and pointed out that despite the numerous risks in the cryptocurrency field, the technology is constantly updated. The market opportunity is still very big.
A research analyst at Royal Bank of Canada (RBC) believes that cryptocurrency, blockchain technology and decentralization are likely to become a $10 trillion ecosystem.
In a new report released on Wednesday, Mitch Steves, equity analyst at RBC subsidiary Capital Markets, optimistically analyzed the reasons for the decentralization of trading services in the future. He wrote: "Although there are many risks in the field of cryptocurrency, as the technology continues to update, the opportunities are still great."
While the implementation of the cryptocurrency protocol as a decentralized alternative to proprietary services or as a remittance startup has gained the most attention throughout the ecosystem's formation, Steves believes that the protocol layer (the underlying protocol for building these services) It is the focus of achieving most of the value.
“We think the protocol layer will achieve more value than the application,†he wrote in the report, adding: “As the application succeeds, the protocol layer gains more value, thus Additional decentralized application development brings more attention."
Therefore, this coincides with the “fat protocol theory†proposed by Union Square Ventures, which believes that the value creation of decentralized cryptocurrency will occur at a lower level. Infrastructure layer.
The report also claims that the cryptocurrency mining market has gained a foothold and believes that the market value of bitcoin mining equipment has reached at least $4.2 billion. In addition, other cryptocurrencies using ASIC mining, such as bitcoin, are worth 3.5. - $450 million, the market value of GPU mining using Ethereum and Monroe is $1.9 billion.
It is worth noting that this report believes that the current decentralization technology has been misunderstood and underestimated, and claims that cryptocurrencies can better handle more and more transactions. In particular, Steves believes that Lightning Network is a tool that can help Bitcoin achieve millions of transactions per second.
However, scalability, as well as government intervention and the emergence of more sophisticated wallet attack technologies, have also been recognized as one of the major risks facing this ecosystem.
However, Steves said that as long as the impeccable security record of the blockchain remains uncontaminated, whether it is based on Ethereum or other alternative underlying protocol chains, continued progress in these areas will benefit the development and mainstream applications of global supercomputers.
“As capacity expansion and agreements mature, the value of computers in the decentralized domain may become a trillion-dollar market,†Steves wrote, summarizing: “If you use a technology that we all agree with is very positive. Expressed, that is, the blockchain has never been hacked. So what happens if we build applications based on this layer of security?"
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