One of the most common questions that investors and enthusiasts ask about cryptocurrencies is: how big is the market potential for this new form of money? In other words, what is the total addressable market (TAM) for crypto?
To answer this question, we need to consider two factors: the number of people who can access and use crypto, and the number of entities that can benefit from crypto. The first factor is relatively easy to estimate, since we have reliable data on the global smartphone penetration and adoption.
According to Statista, there were about 3.8 billion smartphone users in the world in 2021, and this number is expected to grow to 4.3 billion by 2023. This means that almost half of the world’s population already has or will soon have a device that can connect them to the internet and enable them to use crypto applications.
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The second factor is more speculative, but also more exciting. It involves the possibility that not only humans, but also machines, can become participants in the crypto economy.
This idea is based on the assumption that artificial intelligence (AI) will become more advanced and autonomous in the near future, and that these intelligent agents will need a way to interact with each other and with humans in a trustless and decentralized manner.
Crypto provides a perfect solution for this scenario, since it allows machines to have their own identities, wallets, and incentives on the blockchain.
To illustrate this point, let us consider some examples of how AI robots could use crypto in different domains and contexts:
In the field of logistics and transportation, AI robots could use crypto to pay for their services, such as delivery, parking, charging, or maintenance. They could also earn crypto by providing these services to other robots or humans. For instance, a self-driving car could offer rides to passengers and receive crypto payments in return, or a drone could deliver packages and collect crypto tips.
In the field of entertainment and gaming, AI robots could use crypto to access and create content, such as music, videos, games, or art. They could also earn crypto by sharing their content with other robots or humans. For example, a musical robot could compose songs and sell them for crypto, or a gaming robot could play online games and win crypto prizes.
In the field of social and personal interactions, AI robots could use crypto to establish and maintain relationships with other robots or humans. They could also earn crypto by offering their skills, knowledge, or companionship. For example, a conversational robot could chat with lonely people and receive crypto donations, or a educational robot could teach students and get paid in crypto.
These are just some of the possible ways that AI robots could use crypto in the future. Of course, there are many challenges and risks involved in this vision, such as ethical, legal, and security issues. But there are also many opportunities and benefits for both humans and machines.
Therefore, we can argue that the TAM for crypto is not only limited by the number of people who own smartphones, but also by the number of AI robots that will soon join the network. This could potentially increase the TAM by several orders of magnitude, depending on how fast and how widely AI develops and adopts crypto. Of course, this is a very optimistic and futuristic vision, but it is not impossible or implausible.
In conclusion, the TAM for crypto is huge and growing. It encompasses everyone with a smartphone plus every AI robot that’s soon to be on-chain. This means that crypto has a tremendous opportunity to create value and impact for billions of users and entities across the world.