by Smart contracts allow the performance of credible transactions without third parties. It enables digital representation of contractual clauses into lines of code that are self-executed and self-enforced upon fulfillment of pre-defined terms and conditions by parties involved in an agreement. Smart contracts find applications in supply chain management, payments, asset/property exchanges, voting, and financial trading among others. The technology provides benefits such as reduced transaction and processing costs, expedited transaction settlement times, mitigated risks of manipulation or counterparty default, and enhanced transparency.
The global smart contracts market is estimated to be valued at US$ 249.74 Mn in 2023 and is expected to exhibit a CAGR of 16% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
The rapidly rising adoption of blockchain technology across various industries has emerged as a key growth driver for the smart contracts market. Blockchain fundamentally transforms transaction execution by eliminating third parties through peer-to-peer contracting on distributed ledgers, enabled by self-enforcing smart contracts. This significantly improves security, transparency, and trust while lowering financial, regulatory and reputational costs associated with traditional centralized transaction settlement methods. Factors such as the ability to write complex business logic through smart contract code, low error rates due to removal of human intervention, and facilitation of automated contract execution without any downtime are contributing to increasing blockchain and smart contract adoption globally. Furthermore, growing investments in blockchain infrastructure development by governments and companies worldwide is anticipated to boost the smart contracts market expansion over the coming years.
Segment Analysis
The smart contracts market can be segmented into platform, type and end-use. Based on platform, the market can be segmented into Ethereum, Sidechains (Hyperledger, EOS, etc.), NEO, Waves, Corda and other platforms. Ethereum currently dominates the market and accounts for a majority share due to wide developer community support and large number of ICOs deployed on Ethereum blockchain. Based on type, the market can be segmented into Bitcoin Cloud Mining, Ethereum Cloud Mining, Others. The Ethereum type dominates currently due to versatility for developers to build decentralized applications on Ethereum blockchain. Based on end-use, the market can be segmented into supply chain management, government, banking, insurance, real estate,others. Banking & financial services are expected to be the major end-users currently due to growing needs for automation of various tasks.
PEST Analysis
Political: Regulations around use of blockchain and cryptocurrencies vary across countries. Some countries have banned use of cryptocurrencies while others have provided clarity. Clear regulations will help growth of smart contracts market.
Economic: Growing GDP and disposable incomes are increasing investments into cryptocurrencies and blockchain technologies. This will fuel adoption of smart contracts for various uses.
Social: Rising awareness and acceptance of cryptocurrencies and their underlying technologies among general public is positive for smart contracts. Growing startups in the space is also creating buzz.
Technological: Advancements in decentralized computing and distributed ledgers like Ethereum blockchain allows for writing automated smart contracts which can be executed without an intermediary. This simplifies various processes.
Key Takeaways
The Global Smart Contracts Market Demand is expected to witness high growth on account of growing decentralized applications being built on programmable blockchains like Ethereum.
Regional analysis: North America accounts for the largest share currently due to high investments and presence of major technology players in the US and Canada. The governments are also actively supporting development of blockchain technologies in the region. Furthermore, organizations are also rapidly adopting blockchain solutions for applications in banking, healthcare and other sectors.
Key players operating in the smart contracts market are DeviantArt, Nifty Gateway, SuperRare, Foundation, MakersPlace, KnownOrigin, Async Art, ArtBlocks, OpenSea, Rarible, NTWRK, ArtStation, Artsy, Saatchi Art, Singulart, DigitalArt4Climate, Hic et Nunc, Showtime, Verisart, Artmajeur.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
