Web 3.0 is the Next Trillion-Dollar Industry According to Banking, Financial Services Leaders—Everest Group
Report describes current BFSI uses cases, transformative potential, and challenges of the Web 3.0 industry, Metaverse, and Decentralized Finance; seven steps to prepare for the future of financial services.
DALLAS, October 31, 2022 — The future of financial services will be reshaped by exponential technologies such as Web 3.0, metaverse and decentralized finance (DeFi), and the evolution has already begun, according to Everest Group. Enterprises and service providers are anticipating these technologies will drive product innovation as well as new channel strategies and business models, fueling what could potentially be a trillion-dollar market opportunity.
Web 3.0 is a next-generation exponential technology based on blockchain and the third generation of internet in which users can exchange money and information in a secured, trusted, and open model with lower intermediary operations. It is also a critical building block to enhance and monetize various use cases of the metaverse, an immersive online world in which people use avatars to shop, work, socialize and play. DeFi is an evolving business model that leverages emerging technologies to build a connected yet decentralized financial system that offers services that are more accessible, resilient and transparent than centralized, middlemen-focused processes.
Leading enterprises are increasingly investing in Web 3.0 technologies and metaverse platforms. Additionally, customers are increasingly demanding revamped payments, sophisticated financial products, ease of access to credit, and smooth onboarding and advisory services.
“BFSI leaders recognize that these technologies—Web 3.0, metaverse and decentralized finance—are going to reshape their industry by transforming the way they interact and engage with customers,” said Ronak Doshi, partner at Everest Group. “And yet they are also cautious about role of intermediaries and decentralization as well as the speed with which policy makers can accommodate new business models with revamped regulatory approaches. Accordingly, we believe that this shift will be evolutionary rather revolutionary, driven by customer demands and pragmatic product innovation. The journey has begun, with many current applications and innovative proofs-of-concept underway.”
Everest Group provides numerous use cases of Web 3.0, metaverse and DeFi in the banking, financial services and insurance segments in its Market Report, “Future of Financial Services – Web 3.0, Metaverse, and Decentralized Finance.” This report highlights recent investments that big market participants have made in BFSI, how technology and service providers and enterprises can differentiate themselves in the market, Web 3.0 and metaverse use cases that BFSI firms can explore, and regulatory and security challenges in Web 3.0 adoption.
Everest Group advises enterprises to pay close attention to developments in this area and to engage in these strategic steps:
- Understand the opportunities and threats that the Web 3.0 industry entails. Educate and engage retail and institutional investors on the benefits and pitfalls as they will soon seek advisory services around the potential of Web 3.0 and its allied technologies.
- Focus on enabling the proliferation of new products that combine virtual reality (VR), non-fungible tokens (NFTs), and the human being’s desires for social connection.
- Enhance technical and operational capabilities around cloud, blockchain, API and cybersecurity to generate business value from new channels and products.
- Leverage Web 3.0 and metaverse to gain market share by expanding offerings to include cross-border settlements, wholesale payments, and decentralized brokerages to drive value from these investments through in-house development or FinTech partnerships.
- Co-innovate with technology and IT service providers to leverage their skilled talent pool on next-generation technology to achieve economies of scale.
- Adopt principles of interoperability to tap into the network effects of these emerging technologies.
- Build talent and skills in your organization ahead of market demand to ensure rapid scaling of initiatives and not being impacted by shortage of talent.
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About Everest Group
Everest Group is a research firm focused on strategic IT, business services, engineering services, and sourcing. Our research also covers the technologies that power those processes and functions and the related talent trends and strategies. Our clients include leading global companies, service and technology providers, and investors. Clients use our services to guide their journeys to maximize operational and financial performance, transform experiences, and realize high-impact business outcomes. Details and in-depth content are available at www.everestgrp.com.