Blockchain Hangs in the Balance as EV Market Dips

The blockchain market is currently riding on huge upside potential in the near term. The industry, which is expected to generate revenue of over $94.0 billion by the end of 2027, has catered to several sectors and customers. However, the downside to one of the biggest potential customers of the market could keep the growth prospect pressured. A potential stagnation in EV markets could see blockchain’s performance at stake.

Ford reports fallen EV sales, in line with a larger market

According to a report by Yahoo Finance, Ford’s electric vehicle sales suffered a setback in January. The situation resonates with other market giants which have also seen a slump in EV demand.  As of now, the EV industry is seeing a slowdown in upcoming profits. The industry behemoth BYD Electronics has predicted a slower 2023 profit as compared to 2022. Even Tesla had jumped on the same bandwagon to say their short-term growth is currently dicey.

The blockchain-EV alliance

Currently, the EV car industry is using blockchain in several ways. Forbes claims that a majority of cars in the future will unavoidably be electric. An integration of blockchain-based technology into the EV sector is likely to help customers with convenience thereby increasing the ease of use.

The EV industry will expand more quickly if blockchain technology is applied to EV-related enterprises. The lack of charging outlets and the high initial cost of the vehicles are the two main reasons why owning an EV can be challenging. Blockchain technology provides an answer to these problems for electric vehicle operations. Apps, websites, and notification systems based on blockchain can help EV users identify, locate, and use charging stations. They can also be used to keep an eye on the materials imported by EV companies as they deal with global production.

According to McKinsey research, Blockchain technology has the potential to offer the infrastructure for advanced networks that control distribution, trade, sales, and payments. Blockchains and smart contracts can reduce costs and speed transactions, which could assist in alleviating pain points and friction that exist along the entire power value chain.

Will EV saturation make blockchain take a hit?

Blockchain technology is one area where the electric vehicle market may have spillover effects as it gets closer to saturation. With fallen profits and a dicey outlook for the EV sector giants, it is safe to say that the forecast for the industry for the next couple of years is bleak.

Future blockchain users are expected to include EV marketplaces among their ranks. However, one of the blockchain’s largest client bases might disappoint as the industry faces uncertainty. Ever since its creation, digital ledger technology has always looked for methods to expand outside of the cryptocurrency industry. The technology has only recently begun to reach new heights in terms of both client and user bases.

Blockchain may lose out to one of its largest prospective customers if EV marketplaces become saturated. This could lead to fallen profits, a reduced customer base, and less innovation in technology.