The blockchain market currently has significant upside potential in the short term. The industry, which is expected to generate over $94 billion in revenue by the end of 2027, serves several sectors and customers. However, the downside to one of the market’s biggest potential customers could continue to put pressure on growth prospects. A potential stagnation in the EV market could put blockchain performance at risk.
Ford reports decline in EV sales as market expands
Ford’s electric vehicle sales slumped in January, according to a report from Yahoo Finance. This situation resonates with other market giants that are also suffering from a downturn in EV demand. At present, future profits in the EV industry are seen to be slowing down. Industry giant BYD Electronics expects profits to slow in 2023 compared to 2022. Even Tesla has jumped on the same bandwagon, saying that short-term growth is currently in jeopardy.
Partnership between blockchain and EV
The EV automotive industry is currently using blockchain in a variety of ways. Forbes magazine claims that the majority of future cars will inevitably be electric. Integrating blockchain-based technology into the EV space has the potential to improve customer convenience and ease of use.
If blockchain technology is applied to EV-related companies, the EV industry will expand even more rapidly. Lack of charging outlets and high initial cost of the vehicle are two main reasons why EV ownership is difficult. Blockchain technology provides answers to these questions regarding electric vehicle operation. Blockchain-based apps, websites, and notification systems can help EV users identify, locate, and use charging stations. It can also be used to monitor the materials EV companies import as they engage in global production.
According to McKinsey research, blockchain technology has the potential to provide an advanced network infrastructure to control distribution, trade, sales, and payments. Blockchain and smart contracts can reduce costs and speed up transactions, potentially helping to reduce pain points and friction across the electricity value chain.
Will blockchain be hurt by EV saturation?
Blockchain technology is one area that could have a ripple effect as the electric vehicle market approaches saturation. It’s safe to say that the outlook for the industry over the next few years is bleak, with declining profits and the EV industry giant’s precarious prospects.
Future blockchain users are expected to include EV marketplaces as well. However, one of blockchain’s largest customer bases may be disappointed as the industry faces uncertainty. Since its inception, digital ledger technology has always sought ways to expand outside of the cryptocurrency industry. This technology has only recently begun to reach new heights in terms of both client and user base.
Blockchain could lose one of its biggest potential customers if the EV market becomes saturated. This can lead to lower profits, a smaller customer base, and less innovation.