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Chainlink (LINK) co-creator Sergey Nazarov has made a compelling forecast about the future of blockchain. Speaking at the Consensus 2024 conference, Nazarov predicted a significant convergence between blockchain technology and the traditional financial system this year.
Nazarov highlighted the immense potential for on-chain assets, noting the market could exceed $100 trillion. He shared a chart illustrating how the $2.7 trillion debt market and the $106 trillion stock market can transition to blockchain. Other asset classes, including global real estate and derivatives, are also ripe for tokenization.
He stated, “So we’re kind of at another tipping point where the amount of value that you’re seeing in this real-world asset digital asset tokenization trend, even on public chains, has now surpassed DeFi (decentralized finance).”
Nazarov envisions a future where all financial transactions occur on-chain, predicting that 2024 will mark the beginning of the global financial system migrating its settlement systems to public blockchains. He emphasized the efficiency gains, noting that processes which currently take months will be reduced to mere minutes or seconds.
He elaborated, “The world we’re going to is still the world where all the world’s value, all the credits, all derivatives, all commodities, everything is basically on-chain, and represented on-chain and composable on-chain into more and more advanced financial products.”
Nazarov underscored that as more assets move on-chain, they will become composable, creating new benefits and more advanced financial products. He stressed the industry’s current position as a tipping point, with significant institutional interest in blockchain technology.
He concluded, “So I would say, basically that this year is when our industry shifts into this new direction about public chains and about the global financial system merging into a single industry, into a single internet of contracts.”