📑1) Market Size

NFT Market Size (2024 Forecast)

The NFT (Non-Fungible Token) market is growing rapidly. By 2024, the NFT market size is expected to reach about $35.7 billion (about KRW 47 trillion), and by 2028, it is expected to reach about $92.98 billion (about KRW 120 trillion). In particular, the market growth is fuelled by the increasing demand for NFTs in various applications such as art, gaming, and collections.

Foreign Exchange (FX) Market Size (Forecast to 2024)

The foreign exchange market is one of the largest financial markets in the world, with more than $6 trillion (approximately $797 trillion) traded daily. By 2024, the forex market is expected to grow further, especially with the introduction of retail investors and automated trading systems, which will increase trading volumes. While specific figures vary somewhat between institutions and research organisations, the overall growth trend is robust.

DeFi market size (2024 forecast)

The decentralised finance (DeFi) market is also growing rapidly. By 2024, the size of the DeFi market is expected to grow significantly from approximately $23 billion in 2022, as more financial services will be offered in a decentralised form, especially due to advances in smart contracts and blockchain technology. The growth of the DeFi market will be further fuelled by its linkage with NFTs and the introduction of innovative financial services.

As such, the NFT, forex, and DeFi markets are all expected to see significant growth through 2024, with the introduction of new technologies and services being a key growth driver in each market.

Decentralised finance (DeFi) is an attempt to disrupt the traditional financial system, but it comes with a number of problems and limitations.

Problems

1. Inflation due to excessive rewards

1) Problem: Excessive reward schemes can lead to token devaluation, which causes inflation and harms the sustainability of the ecosystem in the long run.

2) Solution: The token economic model needs to be redesigned. For example, you can consider designing the reward scheme more carefully, adjusting the speed of token issuance, and offering other benefits (e.g., discounts on services on the platform) instead of rewards.

2. Unprofitable business harms a large number of users

1) Problem: Some projects pursue short-term profitability to the detriment of many users.

2) Solution: A thorough review of the project's sustainability and profitability is required. Users should carefully review a project's whitepaper, team, roadmap, etc., before investing, and regulators can enforce strict standards to protect investors better.

3. Structure similar to Ponzi schemes

1) Problem: Some DeFi projects may have a structure similar to a Ponzi scheme, where existing investors are paid with funds from new investors.

2) Solution: Transparency and audit systems need to be strengthened. Smart contracts can make all transactions public, and regular audits and reviews by third parties can be mandated to increase trust.

4. Security vulnerabilities

1) Problem: DeFi platforms are often the target of hacks and smart contract vulnerabilities.

2) Solution: Thorough code audits and enhanced security protocols are needed. You can also consider introducing an insurance system to cover security incidents.

5. Lack of regulation

1) Problem: DeFi is not subject to traditional financial regulation, which increases the risk of fraud and illegal activity.

2) Solution: Work with regulators to develop an appropriate regulatory framework and introduce KYC/AML procedures to prevent illegal activities.

6. Complexity and user experience

1) Problem: DeFi platforms can be complex and difficult for the average user to use.

2) Solution: User interfaces and experiences need to be improved to increase accessibility, including intuitive UI/UX design and the provision of educational materials for users.

7. Liquidity issues

1) Problem: Some DeFi platforms lack liquidity, which can disrupt trading.

2) Solution: Liquidity providers can be incentivised to ensure liquidity, and different liquidity pools can be operated to increase stability.

NFT market trends

1. Popularisation and diversity

The NFT market is rapidly becoming more popular, digitising creations in various fields. Artists, creators, musicians, athletes, and many others are publishing their work as NFTs. Big brands and corporations are also using NFTs to try new marketing and fan engagement forms.

Additional perspectives:

Sustainable business models: Brands and creators create new revenue models with NFTs. By connecting directly with fans, they can earn royalties, which can become a sustainable business model.

Cultural diversity: Creators from different cultures and backgrounds are gaining access to global markets through NFTs.

2. Convergence of gaming and entertainment industries

NFTs are playing an essential role in the gaming industry. Virtual items, characters, land, and more are traded as NFTs, enabling real-world ownership and trading within games. This provides greater economic value to players and makes games more immersive.

An additional perspective:

Play-to-Earn: Many games are adopting a play-to-earn model, where players can earn real money within the game. This is a paradigm shift in the gaming industry.

Linkage to the metaverse: NFTs enable asset ownership and trading within the metaverse, forming the economic foundation of the metaverse ecosystem.

3. Decentralised content ecosystem

NFTs are a backlash against centralised control, and there is a growing movement to build decentralised content ecosystems. This allows for direct interaction and transactions between creators and consumers and ensures that transactions are fair and transparent without the involvement of a centralised intermediary.

Additional perspectives:

Community-led: NFT projects are often community-driven, meaning that the community's participation and contributions drive their success. The community plays a vital role in the value of NFTs and the development of the ecosystem.

Adoption of Decentralised Autonomous Organisations (DAOs): NFT projects adopt DAOs to allow the community to make key decisions for the project, which contributes to achieving true decentralisation.

A holistic view

The NFT market is still in its infancy, and technical and regulatory challenges remain, but it continues to innovate and evolve, creating new business models and economic opportunities. The NFT market is expected to grow and mature, and applications and convergence in various fields are expected to become more active.

Based on these trends, the NFT market will continue to evolve and play an essential role in various industries. Innovative approaches and strategies utilising NFTs will create many opportunities in the future.

De-Fi market trends

1. Popularisation and stability

While DeFi has gained much attention due to its early excitement and innovation, several failures have highlighted the importance of stability. Failures such as KLAYswap, LUNA Project, and others have resulted in significant losses for investors, undermining the market's credibility.

Additional perspectives:

Enhancing smart contract security: Vulnerabilities in smart contracts are one of the main risks for DeFi projects. Efforts should be made to address these issues through code audits and security reviews.

Introducing insurance and safeguards: DeFi projects are introducing insurance products or deposit safeguards to protect users' assets, which can increase users' confidence.

2. Convergence of blockchain and the financial industry

DeFi is converging with the traditional financial system to provide new forms of financial services. This goes beyond simple deposits and loans to include financial activities such as liquidity provision, derivatives trading, and staking.

Additional perspectives:

Liquidity pools and staking: DeFi platforms offer various ways for users to leverage their assets through liquidity pools and staking. This increases liquidity in the market and provides additional revenue for participants.

Integration with Ce-Fi: The integration of centralised finance (Ce-Fi) and DeFi is rising. Traditional financial institutions are looking to adopt DeFi's technology and innovations to provide better financial services, driving the popularisation of DeFi.

3. Regulation and Compliance

1) Problem: DeFi is at high risk of illegal activity and fraud due to a lack of regulation.

2) Solution: Work with regulators to develop an appropriate regulatory framework and introduce KYC/AML procedures to prevent illegal activities, which will increase the reliability and safety of DeFi.

4. User experience and accessibility

1) Problem: The complexity and technical barriers of DeFi platforms make them inaccessible to the average user.

2) Solution: Accessibility should be improved by providing user-friendly interfaces and educational materials, making DeFi services more accessible to a broader audience.

5. Sustainability and ecosystem development

1) Problem: The sustainability of DeFi projects is an important issue. Some projects pursue short-term gains and fail to ensure long-term success.

2) Solution: We need to build sustainable business models and develop the ecosystem through community participation and contributions, which can ensure the long-term success of DeFi.

6. Overall

The DeFi market is evolving rapidly and moving towards greater stability and reliability. Popularisation and convergence with the financial industry are important factors for DeFi to reach its full potential. With these trends, DeFi will become more mature and provide opportunities for more users and investors.