BoA report highlights bullish outlook for DeFi and NFTs

05 Oct 2021

The Bank of America (BoA) Corporation has released a report providing an optimistic outlook for cryptocurrencies.

Published by BofA Securities, the report emphasises increasing innovation within the DeFi (decentralised finance) and NFT (non-fungible token) sectors.

The report states that the crypto sector’s $2.15 trillion market cap is “too large to ignore,” adding that the digital asset ecosystem has evolved to include “so much more” than just Bitcoin.

The BoA report defines the sector as comprising “tokens that act like operating systems, decentralised applications (DApps) without middlemen, stablecoins pegged to fiat currencies, central bank digital currencies (CBDCs) to replace national currencies, and non-fungible tokens (NFTs) enabling connections between creators and fans.”

It added: “For us, digital assets are not about payments per se. They’re about a new computing paradigm – a programmable computer that is accessible everywhere and to anyone and owned by millions of people globally.”
Venture capital within the cryptocurrency and blockchain sector has risen substantially this year, the report notes, with more than $17 billion invested into the sector during H1 2021 more than three times the $5.5 billion in 2020, Cointelegraph reports.

In addition, the findings covered the soaring rates of cryptocurrency adoption, estimating that 221 million users around the world had traded crypto or used a blockchain app as of June this year, compared to 66 million in May 2020.

“The applications built on this new software architecture appear to be growing more quickly than past technologies. [...] Anyone in a network can establish a process (application or project) that provides consistency and trust,” the report stated.

In regard to NFTs, the BoA says the surging growth of the sector surprised even the most experienced cryptocurrency users, referring to the OpenSea marketplace generating over $2.5 billion in the first half of the year.