Bank of America Corporation (BoA) has published a research report that presents a bullish view of the long-term prospects of cryptocurrencies.
The report, published on October 4 by BoA subsidiary, BofA Securities, provides a rigorous assessment of the digital asset sector highlighting the innovation taking place in the decentralized finance (DeFi) and non-perishable tokens (NFT) sectors.
The report asserts that the $2.15 trillion cryptocurrency market cap is “too big to ignore,” highlighting that the digital asset ecosystem has evolved to include “much more” than just Bitcoin.
The report describes the sector as including “tokens that function like operating systems, decentralized applications (DApps) without intermediaries, stablecoins pegged to fiat currencies, central bank digital currencies (CBDCs) to replace national currencies, and non-fungible tokens (NFTs) that enable links between creators and fans,” adding:
“For us, digital assets are not about payments per se. They are about a new computing paradigm – a programmable computer that can be accessed everywhere, to anyone, and owned by millions of people around the world.”
The BofA report notes that venture capital in the crypto and blockchain sector has increased significantly in 2021, noting that more than $17 billion was invested in the industry during the first half of this year which is more than three times the $5.5 billion that was made. Pump it into the sector throughout the year. whole year 2020.
The report also highlights the recent increasing rates of crypto adoption, estimating that of the 221 million users globally who have traded cryptocurrency or used a blockchain app as of June 2021 – compared to 66 million in May of 2020.
“It appears that applications built on this new software architecture are growing more rapidly than previous technologies. […] Anyone in the network can create a process (application or project) that provides consistency and trust,” the report states.
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Looking at the NFTs, BoA notes that the booming growth of the sector has surprised veteran crypto users, highlighting that the OpenSea market generated more than $2.5 billion in the first half of 2021.
However, the report warned of the volatility associated with the nascent NFT sector, noting that “the increasing risks in this sector are […] It must be fully understood before NFTs can achieve true adoption.”
