USD 14.1 billion
Decentralized Finance (DeFi) Market Size, Share, Growth Analysis, By Component(Blockchain Technology, Decentralized Applications (dApps) and Smart Contracts Source), By Application(Assets Tokenization, Compliance & Identity), By Industry(BFSI, Retail & E-commerce) - Industry Forecast 2024-2031
Report ID:
SQMIG45E2246 |
Region:
Global |
Published Date: May, 2024
Pages:
197
|
Tables:
96 |
Figures:
70
Decentralized Finance (DeFi) Market Insights
Global Decentralized Finance (DeFi) Market size was valued at USD 14.1 billion in 2022, USD 20.69 billion in 2023 and is projected to grow USD 446.43 billion by 2031, growing at a CAGR of 46.80% in the forecast period (2024-2031).
Broad acceptance of Decentralized Finance (DeFi) has caused a major transformation. It is now a significant driver of market expansion. In the past few years integrating DeFi with decentralized blockchain systems has become popular. The popularity of decentralized finance is rising as it removes third-parties from financial transactions. DeFi has greatly influenced the insurance industry, particularly in solving the challenges of complex procedures, documentation, and audit trails experienced in traditional systems. The adoption of decentralized financial platforms has led to better efficiency within the insurance sector itself, hence serving as a booster for the entire market.
The expansion of the industry is being driven by the various advantages being supplied by DeFi technology providers. One of the major advantages is getting rid of centralized financial institutions such as banks which have traditionally been in control of money, financial products as well as services. Furthermore DeFi systems eliminate costs that banks as well as other financial institutions levy upon those who use their service. Furthermore, they have not been authorized thus are accessible to all internet users thus can be easily accessed using any devices that can connect to the internet, making them gain a lot of popularity.
Market snapshot - 2024-2031
Global Market Size
Largest Segment
Bloackchain technology
Fastest Growth
Decentralized applications (dApps)
Growth Rate
46.80% CAGR
Global Decentralized Finance (DeFi) Market ($ Bn)
Country Share by North America (%)
Global Decentralized Finance (DeFi) Market By Component (%)
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Decentralized Finance (DeFi) Market Segmental Analysis
The global decentralized finance (DeFi) market is segmented based on component, application, industry, and regional type. In terms of component, the market is trifurcated into blockchain technology, decentralized applications (dApps) and smart contracts. Based on application, the market is grouped into assets tokenization, compliance & identity, marketplaces & liquidity, payments, data & analytics, decentralized exchanges, prediction industry, stablecoins and others. In terms of industry, the market is segmented into BFSI, retail & E-commerce, media & entertainment, automotive, and others. Based on region, the market is segmented into North America, Europe, Asia Pacific, Central & South America and Middle East & Africa.
Analysis by Component
As per categorization by component, the market is classified as blockchain technology, decentralized applications (dApps) and smart contracts. Among these, blockchain technology earned the largest share and continues to dominate the market. Blockchain components are being adopted and innovated in unprecedented ways in the global decentralized finance (DeFi) market, enabling peer-to-peer lending, asset management, and transactions without the need for middlemen. Blockchain governs this sector since its processes are decentralized that allow users to operate without putting trust on each other. Also it is more clear because one can see every transaction that occurs in it besides being more accountable thereby improving on its security through transparency and automation of procedural costs that reduce costs thus attracting customers yearning for worldwide access and independence in terms of finances.
dApps and smart contracts, which are anticipated as having the highest growth in the worldwide D decentralized financial market (DeFi) because of their transformative aspects to the financial services industry, accessed by users directly from their wallets offer a wide range of trading, asset management and lending services to users. In eliminating intermediaries, smart contracts cut costs by automating and enforcing transactions. The increasing requirement for users’ own privacy, security and self-determination is expected to give rise to a great need for dApps and smart contracts thereby enhancing the DeFi ecosystem.
Analysis by Application
Due to advancements in data and analytics applications, The Global Decentralized Finance (Defi) Market is undergoing transformation with insights needed for risk management and informed decision-making provided amply therein. Utilizing big data and blockchain technology that contributes to transparent processes, these applications allow users to identify assets with high rates of returns while minimizing their exposure to certain risks. Their strength in the market lies in their dominance when it comes to improving management of product portfolio, ensuring regulatory compliance, and enhancing financial decision making. This allows customers to make wise choices in decentralized financing.
Due to their revolutionary potential, tokenization, payments, decentralized exchanges, stablecoins, marketplaces & liquidity, compliance & identification, and the prediction sector are expected to develop at the quickest rates in the Global Decentralized Finance (DeFi) Market. Tokenization increases the number of investments and frees liquidity because of its ability to enable partial asset ownership. Compliances and identity systems ensure that there are compliance policies as well as trusted relationships between people through legality. Asset trading efficiency and accessibility can be improved by trading platforms and liquidity markets. The ease in transaction using payments makes them decentralized as well as stable coins help avoid price instability. Moreover, the forecasting industry uses blockchain technology for making projections in open-source and unregulated way. This promotes new ideas and growth in a decentralized financing system.
Global Decentralized Finance (DeFi) Market By Component (%), 2022 (%)
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Decentralized Finance (DeFi) Market Regional Insights
The market in 2022 was dominated by decentralized finance in North America as the sector with the most established companies comes out at the top. Moreover, North America hosts one of the largest cryptocurrency market hence a potential breeding ground for DeFi platforms. Europe ranks second in terms of market size for decentralized finance market due to benefits associated with those who provide DeFi technology services. The system gets rid of the power the banks and other financial organizations have over money, financial services, and financial goods. Furthermore, it does away with usage fees that banks and other financial organizations impose on customers. Furthermore, the Decentralized Finance market in Germany commanded the highest market share, while the Decentralized Finance market in the United Kingdom grew at the quickest rate in the European Union.
Between 2023 and 2032, the Asia-Pacific DeFi market should expect the highest Compound Annual Growth Rate (CAGR). This is because Asia has rapidly embraced technology and invested in its growth. In the Asia-Pacific region, decentralized finance service providers are many DeFi-platforms and other companies that leverage the advantages offered by Distributed Ledger Technologies (DLT) to provide services ranging from borrowing or lending funds with certain terms stipulated to trading assets using smart contracts among others. Strategic actions of stakeholders in the sector trigger expansion in the area. Brazil, Mexico, as well as Nigeria are some of the countries within Latin America and Middle East & Africa that register the fastest growth rate as it can be attributed to numerous factors such as high penetration rate of smartphones, increased population of young people and the growing interest in digital resources. As such regions possess unexploited opportunities for DeFi programs it is becoming apparent to statesmen that blockchain technology plays a vital role in achieving financial inclusion and boosting economic development.
Global Decentralized Finance (DeFi) Market By Geography, 2024-2031
- Largest
- Fastest
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Decentralized Finance (DeFi) Market Dynamics
Drivers
Rising Demand in E-Sports and Gaming
- A safe and user-friendly betting platform is in high demand due to the exponential growth in e-sports betting. Decentralised Finance: Using Blockchain technology, this sports betting solution is outfitted with a decentralised finance system that facilitates anonymous direct payments without putting one's own money at risk or requiring an intermediary or brokerage. contributing to the market expansion for decentralised finance (defi).
Growing Use of Digital Currency
- There is a growing need in the bitcoin market for Decentralised Finance apps such as Uniswap and Sushiswap as a result of the rapid increase of cryptocurrency use. By doing away with the necessity for a middleman, the decentralised technology used by the cryptocurrency market on a blockchain network makes it simple and affordable to access capital. Consequently, driving the market for decentralised finance during the projection period.
Restraints
Risks Associated with Smart Contracts
- Smart contracts are widely regarded as secure and have grown to be an essential part of the DeFi ecosystem. But it can be challenging as different nations have different legal frameworks and regulatory challenges. Smart contracts remove the protections provided by traditional contracts against severe clauses and poorly designed contracts, which hinders the expansion of the decentralised finance market.
Regulators Are a Source of Concern
- Code exploits, attacks on blockchain networks, and security flaws in smart contracts can all result in significant financial losses. Due to the new and untested protocols being used by DeFi projects, attacks and security flaws may be introduced more readily. Furthermore, in terms of rules, DeFi isn't really a black box in many regions.
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Decentralized Finance (DeFi) Market Competitive Landscape
Prominent market participants have extended their reach and enhanced their range of products and services by forming alliances and partnerships with fintech firms, other financial institutions, and technology suppliers. In addition to major market advancements, market players are forming a range of strategic alliances with rivals in order to grow and endure in an increasingly cutthroat and dynamic business environment.
Top Player’s Company Profiles
- Bancor Network (Switzerland)
- Balancer (US)
- SushiSwap (Japan)
- Dapper Labs, Inc. (Canada)
- Uniswap (US)
- MakerDAO (US)
- Synthetix (Australia)
- Badger DAO (US)
- Compound Labs, Inc. (US)
- Curve Finance (US)
- MetaMask (US)
- Moon Pay Limited (US)
- Hashflow (US)
- Aave (UK)
Recent Developments
- In March 2024, The DeFi ecosystem's increasing demands require the blockchain network to be more scalable and efficient, which is why the Ethereum Foundation has announced major changes to the network. A significant advancement in the development of decentralized finance, these changes include the adoption of Ethereum 2.0's proof-of-stake consensus mechanism, which attempts to increase transaction throughput and decrease energy usage.
- In April 2024, Leading international cryptocurrency exchange Binance announced the launch of its DeFi accelerator programme, which aims to promote development and innovation in the DeFi market. By means of this effort, Binance facilitates the development and adoption of promising DeFi initiatives and helps to expand the global reach of decentralized financial solutions by offering money, technical support, and mentorship.
- In May 2024, The blockchain technology startup ConsenSys has announced the opening of a new research and development center with a DeFi focus. This center is intended to increase the adoption and capabilities of decentralized finance applications. With the help of academic institutions, industry players, and regulators, this project seeks to solve obstacles, spur innovation, and encourage the broad use of DeFi solutions in international financial markets.
Decentralized Finance (DeFi) Key Market Trends
- Transforming Finance with Decentralized Exchanges in DeFi: Decentralized Finance, or DeFi, is revolutionizing financial services. It represents equity and behaviors that are clear to see when everyone is involved. Big changes are occurring in the independent finance market, which makes use of emerging blockchain technologies. This will determine its future course. The increasing prevalence of decentralized exchanges (DEXs) represents a significant shift in the Unattached DeFi Market.
- Evolution of Decentralized Lending and Borrowing in DeFi: The expansion of decentralized lending and borrowing regulations is another significant shift. DeFi platforms are enabling individuals to lend or borrow items on their own without the necessity for traditional financial institutions. Smart contract-based lending regulations enable users to borrow money or earn interest on their cryptocurrency holdings by securing them with valuables.
Decentralized Finance (DeFi) Market SkyQuest Analysis
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
As per SkyQuest analysis, Decentralized finance (DeFi) is expanding due to the growing need for user-friendly and safe e-sports betting platforms and the need for decentralized finance apps such as Uniswap and Sushiswap in the bitcoin market. DeFi is made possible by blockchain technology, which makes it simple to access capital without middlemen and allows for anonymous direct payments. The DeFi ecosystem's perceived security of smart contracts is tempered by difficulties resulting from different legal frameworks in different countries. This could leave users vulnerable to harsh clauses and poorly designed contracts, which would impede market expansion. Additionally, regulators' concerns regarding code exploits and security flaws pose additional risks and could affect the dependability of DeFi protocols in areas where regulatory frameworks are unclear.
As they attempt to navigate a competitive and changing business landscape by fostering collaboration and leveraging collective expertise and resources, prominent players in the financial sector are forging strategic alliances and partnerships with fintech companies, financial institutions, and technology suppliers in order to expand their offerings and fortify their market presence. The emergence of decentralized exchanges (DEXs) marks a significant shift in the decentralized finance (DeFi) environment, propelled by blockchain technology. Meanwhile, the development of decentralized lending and borrowing laws permits users to conduct autonomous peer-to-peer transactions, utilizing smart contracts to enable safe lending and borrowing within the DeFi network.
| Report Metric | Details |
|---|---|
| Market size value in 2022 | USD 14.1 billion |
| Market size value in 2031 | USD 446.43 billion |
| Growth Rate | 46.80% |
| Base year | 2023 |
| Forecast period | 2024-2031 |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
|
| Customization scope | Free report customization with purchase. Customization includes:-
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Table Of Content
Executive Summary
Market overview
- Exhibit: Executive Summary – Chart on Market Overview
- Exhibit: Executive Summary – Data Table on Market Overview
- Exhibit: Executive Summary – Chart on Decentralized Finance (DeFi) Market Characteristics
- Exhibit: Executive Summary – Chart on Market by Geography
- Exhibit: Executive Summary – Chart on Market Segmentation
- Exhibit: Executive Summary – Chart on Incremental Growth
- Exhibit: Executive Summary – Data Table on Incremental Growth
- Exhibit: Executive Summary – Chart on Vendor Market Positioning
Parent Market Analysis
Market overview
Market size
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- SWOT Analysis
KEY MARKET INSIGHTS
- Technology Analysis
- (Exhibit: Data Table: Name of technology and details)
- Pricing Analysis
- (Exhibit: Data Table: Name of technology and pricing details)
- Supply Chain Analysis
- (Exhibit: Detailed Supply Chain Presentation)
- Value Chain Analysis
- (Exhibit: Detailed Value Chain Presentation)
- Ecosystem Of the Market
- Exhibit: Parent Market Ecosystem Market Analysis
- Exhibit: Market Characteristics of Parent Market
- IP Analysis
- (Exhibit: Data Table: Name of product/technology, patents filed, inventor/company name, acquiring firm)
- Trade Analysis
- (Exhibit: Data Table: Import and Export data details)
- Startup Analysis
- (Exhibit: Data Table: Emerging startups details)
- Raw Material Analysis
- (Exhibit: Data Table: Mapping of key raw materials)
- Innovation Matrix
- (Exhibit: Positioning Matrix: Mapping of new and existing technologies)
- Pipeline product Analysis
- (Exhibit: Data Table: Name of companies and pipeline products, regional mapping)
- Macroeconomic Indicators
COVID IMPACT
- Introduction
- Impact On Economy—scenario Assessment
- Exhibit: Data on GDP - Year-over-year growth 2016-2022 (%)
- Revised Market Size
- Exhibit: Data Table on Decentralized Finance (DeFi) Market size and forecast 2021-2027 ($ million)
- Impact Of COVID On Key Segments
- Exhibit: Data Table on Segment Market size and forecast 2021-2027 ($ million)
- COVID Strategies By Company
- Exhibit: Analysis on key strategies adopted by companies
MARKET DYNAMICS & OUTLOOK
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- Regulatory Landscape
- Exhibit: Data Table on regulation from different region
- SWOT Analysis
- Porters Analysis
- Competitive rivalry
- Exhibit: Competitive rivalry Impact of key factors, 2021
- Threat of substitute products
- Exhibit: Threat of Substitute Products Impact of key factors, 2021
- Bargaining power of buyers
- Exhibit: buyers bargaining power Impact of key factors, 2021
- Threat of new entrants
- Exhibit: Threat of new entrants Impact of key factors, 2021
- Bargaining power of suppliers
- Exhibit: Threat of suppliers bargaining power Impact of key factors, 2021
- Competitive rivalry
- Skyquest special insights on future disruptions
- Political Impact
- Economic impact
- Social Impact
- Technical Impact
- Environmental Impact
- Legal Impact
Market Size by Region
- Chart on Market share by geography 2021-2027 (%)
- Data Table on Market share by geography 2021-2027(%)
- North America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- USA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Canada
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Europe
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Germany
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Spain
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- France
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- UK
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Europe
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Asia Pacific
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- China
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- India
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Japan
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Korea
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Asia Pacific
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Latin America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Brazil
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of South America
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Middle East & Africa (MEA)
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- GCC Countries
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Africa
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of MEA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
KEY COMPANY PROFILES
- Competitive Landscape
- Total number of companies covered
- Exhibit: companies covered in the report, 2021
- Top companies market positioning
- Exhibit: company positioning matrix, 2021
- Top companies market Share
- Exhibit: Pie chart analysis on company market share, 2021(%)
- Total number of companies covered
Methodology
For the Decentralized Finance (DeFi) Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Decentralized Finance (DeFi) Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
Analyst Support
Customization Options
With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Decentralized Finance (DeFi) Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Decentralized Finance (DeFi) Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
Go to Market Strategy: Find the high-growth channels to invest your marketing efforts and increase your customer base.
Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
Public Company Transcript Analysis: To improve the investment performance by generating new alpha and making better-informed decisions.
Social Media Listening: To analyze the conversations and trends happening not just around your brand, but around your industry as a whole, and use those insights to make better Marketing decisions.
Decentralized Finance (DeFi) Market Report Snapshots
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