Here are nine potential beneficiaries in the Blockchain market


The prices of bitcoin, ethereum and other cryptocurrencies have declined a lot this year, but that does not mean it's the end of the blockchain road. Applications for blockchain beyond cryptocurrencies are almost endless, but investors may have difficulty determining where to invest to get a piece of the blockchain cake.

Blockchain market
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Total addressable market for blockchain

Sometimes the investment banks offer some suggestions. This time it is Bank of America Merrill Lynch with a list of suggested titles that could benefit from the blockchain trend at some point in the future.

Q3 letters of hedge funds, conferences, palettes, etc.

In a recent note by a large team led by analyst Kash Rangan, BAML anchored the total addressable blockchain market to around $ 7 billion. On the surface, this seems a rather arbitrary number, especially if we consider that the company does not commit itself to dedicate a pre-established time. The big problem is that there are many different ways to estimate the blockchain market.

The analysis of BAML is based on the average sales price per server per year, on the number of servers installed worldwide and on the percentage of servers running blockchain. The company model assumes that 2% of the servers in the world run blockchain worth $ 5,500 per server per year.

IDC estimated the blockchain market at $ 735.6 million last year; the company sets the market at $ 10.9 billion by 2022. IDC expects that within the next two years, a quarter of the world's major banks, 30% of retailers and manufacturers and 20% of healthcare organizations will use the blockchain.

Monetization of blockchain technology

Another clear problem in estimating the value of the blockchain market is that it is not yet clear how blockchain services can be monetized. While numerous analysts and experts have outlined a wide variety of potential use cases for technology, actually monetizing those use cases is still a mystery. However, BAML analysts have some suggestions.

They see blockchain monetization in the future as the mirroring of cloud services today. They describe potential monetization as "blockchain infrastructure as a service", which basically involves the provision of end-to-end blockchain solutions. They see VMWare as the biggest potential seller for this style of monetization.

Another suggestion they offer is "blockchain platform as a service", which basically only means providing a platform on which customers can set up their own protocols and applications. BAML suggests that IBM, Oracle, VMWare and Ethereum could be among the potential providers of this type of blockchain technology, among others.

They also see the potential for "blockchain applications as a service", which basically means only blockchain service offerings that are ready for use in various ways, for example through smart contracts, e-commerce transactions, supply chains and more. . They suggest Microsoft, Oracle and Salesforce as potential suppliers for this type of blockchain.

Investing in stocks for blockchain exposure

Based on their ideas for monetizing the blockchain, BAML analysts have selected their "Blockchain 9", which are the companies they feel could become the biggest beneficiaries of technology.

It should not be surprising that Amazon's perennial favorite technology is the first on the list. The BAML team sees the benefits of improvements in payment processing and supply chain monitoring. Given that Amazon also offers cloud services, they also think that the company could benefit from the increased demand for these services caused by blockchain implementation.

In second place on their "Blockchain 9" list is Microsoft, which they already support a series of blockchain protocols and projects, such as the Azure blockchain as a service program. Oracle offers blockchain technology platform support through its Oracle Blockchain Cloud Service and other software-as-a-service apps. Oracle should also take advantage of the increased cloud demand due to the blockchain.

BAML analysts see IBM as the leader in the blockchain with its Hyperledger Fabric, and expect the company to hold at least 10% of the blockchain market at the end. Salesforce may not be far behind since it introduced new technology solutions to Dreamforce this year. Other potential blockchain beneficiaries include VMWare with its Project Concords and Redfin, Zillow and Lending Tree.

This article originally appeared on ValueWalk Premium

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