We live in an inefficient world. A very inefficient world.
In some places, people still deal with piles of paper documents, government departments require in-person visits to complete simple procedures, and transactions are ridiculously expensive, even though the cost of these transactions should be a few cents.
But there is a way out of this dilemma… Blockchain is not just about decentralized finance and smart contracts, it can also build a more efficient, transparent and more accessible system.
So how much money can this save? Using simple estimates, here's a rough number: $710 billion!
Honestly, I think that's a conservative estimate, but it's still a staggering number.
In addition to enabling new business models, blockchain could also reduce fraud in local (and eventually national) governance and voting systems, and give people more control over their data and money…
Cryptocurrency could save the world more than half a trillion dollars per year.
Equivalent to the GDP of Saudi Arabia.
Let’s break this down.
International trade: $280 billion
Have you seen those giant containers at the port? Every mission comes with a stack of paperwork thicker than War and Peace.
All of this is paper, shipping documents, all of this is paper. All of this has to be mailed, faxed, or even delivered in person around the world.
It's like the 18th century way of doing things, but we have WiFi now.
According to the World Trade Organization (WTO), trade-related documentation and administrative costs account for an average of 20% of total shipping costs.
The International Chamber of Commerce (ICC) estimates that this means we waste around $280 billion each year on outdated trade processes.
Encryption technology can transform these documents into an automated, tamper-proof, instant processing system. No more waiting weeks for verification and mailing of documents.
This would save approximately $280 billion.
U.S. real estate commissions: $100 billion
In the United States alone, people pay up to 6% in fees to buy and sell real estate.
According to an article by the Urban Institute, Americans pay the highest real estate agent commissions in the world, approximately $100 billion per year.
And those are just the numbers for the United States.
Through cryptography, smart contracts can be used to automate real estate contracts and escrow services.
Global real estate market: saving another $100 billion
Now extend those savings globally.
Real estate transactions are slow, expensive and bureaucratic across the globe.
According to the latest report from Savills, the total value of global real estate is approximately US$379.7 trillion, almost four times the global GDP.
Even small efficiency gains can lead to huge savings.
Imagine an international real estate transaction where you have to deal with currency conversions, legal fees, and cross-border regulations.
Encryption technology can simplify all of this.
Smart contracts could automate the entire process, making buying a house in Spain as easy as buying a book on Amazon. Another $100 billion could be saved.
Supply Chain Management: $50 billion
Have you ever wondered why products get lost, delayed, or even stolen? That’s because the global supply chain is a logistical nightmare involving dozens of parties and no single source of truth.
Blockchain can track goods from the moment they leave the factory until they arrive at your doorstep, with real-time updates, tamper-proof records, and automated payments.
The cost savings? $50 billion per year from reduced losses, reduced fraud and optimized logistics. An efficiently functioning supply chain – this will be a whole new concept.
Financial services: $50 billion
Cross-border payments and remittances are also a mess.
Sending money from the US to India can take days and you’ll have to pay hefty fees.
The World Bank estimates that the average cost of remittances worldwide is about 7%, or $30 billion. Add to that the inefficiencies in clearing houses and settlement processes, and the entire system is like a black hole that swallows up money.
With cryptocurrencies, we can achieve instant transactions, no intermediaries, and significantly reduced fees. The potential savings? Easily $50 billion.
Insurance industry: $40 billion
Have you ever filed an insurance claim? It feels like asking a street vendor for a refund - good luck.
Fraud, inefficiency and reams of paperwork make the insurance industry an ideal candidate for disruption.
The FBI estimates that non-health insurance fraud causes losses of more than $40 billion per year in the United States alone.
Meanwhile, a report from Accenture noted that more than 80% of insurance executives said their organizations have either adopted or are piloting relevant technologies.
Smart contracts can automate the processing of claims, verify data in real time, and eliminate the need for human intervention. The result? Conservatively estimated savings of approximately $40 billion in reduced fraud and lower administrative costs.
Healthcare: $30 billion
Now let's talk about the healthcare industry.
Not the cost of your last doctor visit—that's another nightmare. I mean your medical records.
These records are scattered among different hospitals, clinics and insurance companies, and trying to bring them all together is a daunting task.
Encryption technology can create a unified, secure system for local medical records. Every medical provider can access the same data with the patient's permission.
That’s why Grand View Research predicts that the industry will grow at a compound annual growth rate (CAGR) of 63.3% by 2030.
It’s a transparent, tamper-proof, and efficient system. The end result? At least $30 billion in savings from reduced administrative overhead and improved patient care.
Legal and compliance: $25 billion
The legal process is often slow, expensive and often unnecessary.
Do we really need to pay hundreds of dollars per hour to verify that a signature is valid?
Smart contracts can automate much of these processes, making legal agreements automatically executed and enforceable. No more tracking down signatures or arguing over contract terms. The savings? $25 billion per year.
Intellectual property: $20 billion
Have you ever had your idea stolen? Have you ever tried to prove it was yours in court? It feels like grabbing smoke with your bare hands.
Intellectual property disputes are time-consuming and expensive.
Cryptography can provide a transparent, tamper-proof record of ownership and use. Proving ownership is as easy as showing your passport at the airport.
The potential savings? $20 billion.
Energy market: $15 billion
Energy trading is another maze of inefficiencies, with middlemen, brokers and outdated systems eating up profits.
Cryptography can enable peer-to-peer energy trading, automate settlement, and create a transparent market where energy can be traded like stocks.
The result? $15 billion in annual savings from lower transaction costs and more efficient markets.
Total potential savings: $710 billion
Add all the numbers together and you get a potential savings of $710 billion, which is more than the GDP of a country like Switzerland or Saudi Arabia.
And these are not wild guesses; these are realistic and achievable numbers.
Think about this carefully.
We’re talking about a technology that could save the world hundreds of billions of dollars every year, simply by making things run more efficiently.
It's like discovering a cheat code for the global economy.
So, the next time someone tells you crypto is just a toy for geeks and speculators, tell them this. Because while they’re busy arguing about memecoins and NFTs, crypto is quietly preparing to save the world a fortune.
This is the future we talk about. And this future is happening now.
Our portfolio is poised to benefit from these gains.
As always, we are still looking for new opportunities.
