DMCC – the world’s flagship free zone and Government of Dubai Authority on commodities trade and enterprise – today released a special edition of its Future of Trade thought leadership report focused on Web3, examining the key drivers of growth, innovation and digital decentralisation in a number of technology trends.

The report, titled “Digital Decentralisation: Crypto, DeFi and the Metaverse,” explores the market outlook and opportunities for Web3 trends rooted in a blockchain-based digital infrastructure, including cryptocurrency, decentralised finance (DeFi), and the metaverse. The report assesses recent challenges in these sectors and forecasts a period of maturity, with recommendations for industry and regulators to nurture and fast-track industry growth in the coming years.

The market size for the metaverse is set to rise to USD 3.4 trillion by 2027 supported by road-tested use cases and the rapid advancements of Artificial Intelligence. The global DeFi market is expected to grow from USD 13.6 billion in 2022 to USD 600 billion by 2032, driven by the demand for fast and feeless financial services. Meanwhile, the crypto market appears set to stabilise after a period of turbulence, with 2023’s Bitcoin revival casting a spotlight on renewed appetite among industry and institutions for durable and value-added services.

However, much depends on the path regulators take and their ability to balance innovation, consumer protection, and fraud risk. The report reviews government approaches across key regions, namely MENA, Asia, Europe and the United States. It finds that innovation hubs are emerging in countries like the UAE, which secured USD 25 billion of crypto transactions in 2022, and is pushing to attract further investment through accommodative regulatory stances.

Ahmed Bin Sulayem, Executive Chairman and Chief Executive Officer, DMCC said: “Our latest Future of Trade report showcases the exceptional growth on the cards across Web3, from crypto and DeFi, to AI and the metaverse. The global metaverse market is projected to rise to over USD 3.4 trillion by 2027, with advances in AR/VR technology opening a vast realm of opportunities beyond gaming and e-commerce to real estate, retail, education, and healthcare. Digital decentralisation is perhaps the most seismic industry trend in the technology era and the insights in our Future of Trade report reinforce how Dubai and the UAE are supporting its growth trajectory with an investor-friendly approach that balances innovation with the need for consumer protection. I believe that DMCC is perfectly positioned to assist the next wave of global Web3 companies fully seize and capitalise on the rich opportunities in this fast-moving landscape.”

Belal Jassoma, Director of Ecosystems, DMCC added: “With a positive and progressive approach to regulation, active engagement with market players, and ample opportunities to innovate and grow, this report demonstrates why Dubai remains a premier hub for Web3 businesses. Through DMCC Crypto Centre we have enabled one of the most supportive ecosystems in the world for those operating in this space, expanding last year to over 600 members with the provision of dedicated services and top ecosystem partners. I believe that the critical insights and perspectives contained in our Future of Trade report will give further confidence to our members as well as to new market entrants looking to grow from Dubai.”

The Future of Trade report outlined several important industry and regulatory recommendations to help drive the evolution of Web3 and shape the next phase of its growth:

• Use principle-based regulation: By recognising the innate potential of crypto and metaverse technologies, and prioritising consultative regulation, governments can create a principle-based regulatory framework that protects consumers and supports innovation.
• Increase public and private engagement: All stakeholders should engage regularly and in a meaningful way to ensure that market developments and issues are dealt with swiftly and effectively, and to improve public awareness and education about risks.
• Promote Web3 innovation through industrial clustering: Companies and start-ups in the Web3 space can foster innovation through dedicated sector ecosystems such as the DMCC Crypto Centre, which enable knowledge exchange, education, access to capital and talent, and opportunities to tap into global business networks.
• Prioritise education and recruitment as the key to Web3 growth: In order to leverage Web3 technologies and maximise their benefit, industries should give priority to education, nurturing of new tech talent, provision of in-house training, and financial resources.
• Provide sustained long-term investment: Companies that invest and understand how markets operate will be best placed to reap the financial rewards of these technologies in the future.
• Develop Web3 adoption and scalability plans now: Companies should kickstart immediate preparations for Web3 adoption through investment, training and board-level strategies. Any delay places a business at considerable risk of competitive disadvantage.

The DMCC Crypto Centre is a comprehensive ecosystem for companies that develop Web3 and blockchain technologies, and associated value-added services, providing everything that crypto businesses and entrepreneurs need to set up and scale their operations. Having grown to over 600 members, and counting a number of industry leaders as ecosystem partners including Bybit, Solana and TDeFi, the DMCC Crypto Centre plays a major role today in supporting the growth of start-ups and reinforcing Dubai’s status as one of the major global hubs for Web3 innovation.

To download and read the full report, please visit: www.futureoftrade.com