Hot off its best month ever, the latest Big Ideas report by ARK Invest predicts the market for Bitcoin, blockchain and the entire crypto industry will explode into a $10 trillion industry.
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Cryptocurrencies could be a $10 trillion business by 2030, with smart contracts commanding another $5 trillion, according to new research from Cathie Wood's ARK Invest.
The report comes as Wood's flagship ARK Innovation Fund ETF had the best month in its nine-year history, racking up gains of nearly 28%.
Wood is a longtime BTC bull and blockchain believer, as well as an aggressive investor in Coinbase, repeatedly buying COIN 24 times in 2022 and twice more last month as its share price tumbled due to disappointing quarterly earnings reports.
Its $347 million in COIN now accounts for 4.5% of the ETF's portfolio.
The Big Ideas report's 14 categories — which range from AI to robotics to targeted gene therapies — include three specific to crypto and blockchain: public blockchains, smart contracts and bitcoin.
Despite the three-part crypto contagion that wiped $1.5 trillion off crypto's market capitalization in 2022 — the failures of the UST and LUNA, Three Arrows Capital and FTX — Wood believes that public blockchains "continue to foster multiple revolutions."
The three most notable are what she believes are the coming money, financial and internet revolutions.
The first is a growing transfer of value from state-controlled fiat currency and central banks to "global, decentralized, non-state money."
Next is a movement of financial services away from traditional institutions (TradFi) to decentralized finance (DeFi.)
Finally, there is a Web3 revolution that moves "coordination of identity, reputation and data outside the purview of traditional media conglomerates and big tech."
The report places Bitcoin at the center of the money revolution, saying that long-term, its opportunity is strengthening. It said:
"Despite a turbulent year, Bitcoin has not skipped a beat. Its network fundamentals have strengthened and its holder base has become more long-term focused. Contagion caused by centralized counterparties has elevated Bitcoin's value propositions: decentralization, auditability, and transparency."
Over three, four and five-year timeframes, it said, Bitcoin has "outperformed every major asset class."
Beyond that, institutions including BlackRock, BNY Mellon and Fidelity among others, committed to BTC during the bear market.
With centralized crypto finance's credibility hammered during the 2022 bear market, Wood's report said that decentralization "is proving more critical to maintaining the original value proposition of public blockchain infrastructure."
With the addition of DeFi and NFTs, public smart contract blockchains like Ethereum have diversified crypto well beyond the simple transfer of funds in Bitcoin creator Satoshi Nakamoto's vision, the report argued.
As the value of assets tokenized on those decentralized blockchains grows, "decentralized applications and the smart contract networks that power them could generate $450 billion in annual revenue and reach $5.3 trillion in market value by 2030," it said.