The blockchain market has lost $2.8 billion over the last two years, with the coronavirus disease (COVID-19) pandemic affecting the new industry’s growth     

Blockchain adoption and revenue have dramatically dropped between the 2018 crypto winter and the 2020 COVID-19 pandemic. The global revenues of the blockchain market declined by 35% between the period.

According to the global tech market advisory firm ABI Research, the estimated loss for the market currently stands at around $2.8 billion. During the bear season of 2018, the cryptocurrency market lost most of its market cap, with over 2,000 cryptocurrencies folding up their businesses. The decline in the cryptocurrency market negatively affected blockchain technology’s adoption as several startups couldn’t leverage the technology due to the declining market cap. The COVID-19 pandemic this year has further affected the blockchain revenues as the global economy continues to suffer significantly.

Despite the decline in adoption and revenues, ABI Research believes it would be short-lived. Blockchain technology is starting to gain mainstream adoption as leading industries worldwide are looking to leverage its advantages. Blockchain is gaining adoption in areas such as supply chain, education, government, transportation, health, energy, internet of things (IoT) and resource monitoring.

Michela Menting, who is currently the Digital Security Research Director at ABI Research, believes that the crypto winter and COVID-19 pandemic helped purge the marketplace of speculative offerings. Hence, the more vital startups would have sufficient room to offer excellent services and boost technology adoption.

Menting stated that several speculative companies were eliminated from the marketplace and that would do wonders for the blockchain ecosystem in general. It would strengthen the existing startups and ensure that only the more viable and valuable business models are created over the next few years. Hence, ABI Research believes that the market will attain the 2018 highs by 2023.

Despite the decreasing adoption and declining revenues, blockchain technology has improved several aspects of the global economy. According to Menting, the pandemic showed how inadequate and flawed some of our existing procedures are, especially in terms of transparency and product quality assurance. This is where blockchain technology comes in, as it is designed to address these issues. As more countries and companies worldwide show interest in blockchain technology, the demand will boost revenue for blockchain applications, with a huge focus in areas such as manufacturing, transport, storage, retail and consumer.

Blockchain is likely to gain further adoption in the coming years. The current global spending on blockchain stands at $4.1 billion, with most of it coming from the banking and financial sector. However, supply chain logistics, healthcare and agriculture are expected to be amongst the leading sectors for blockchain adoption in the coming years.