Market Opportunity

"Generative AI is the largest TAM expansion of software and hardware that we've seen in several decades." — Jensen Huang, President and CEO of Nvidia- Q3 2024 earnings call

Over the last few years artificial intelligence (AI) has evolved into a transformative force having the potential to disrupt industries and economies around the world. The rise of generative AI models have impacted almost every sector with organisations rapidly adapting to the change to enhance their operational efficiency.

AI's impact extends beyond current operations, driving innovation and the creation of new markets. Whether it is financial services, healthcare, manufacturing or infrastructure, AI is boosting efficiency, unlocking new revenue opportunities thereby accelerating growth. According to the International Data Corporation (IDC), AI business spending and adoption will have a cumulative global economic impact of $19.6 trillion through 2030.

This rapid expansion of AI applications has led to an unprecedented demand for resource and infrastructure investments. Global data centre demand is expected to grow at a CAGR of 12% to 15% between now and 2030, resulting in the construction spending to exceed $303 billion during this period. Moreover, the need for AI infrastructure would also result in a power demand surge, which according to Goldman Sachs is expected to rise by about 200 terawatt-hours (TWh) between 2024 and 2030, potentially representing 20% of overall data center power demand by 2030. This energy demand is driven by the computational intensity of AI training and inference work.

This expected demand underscores the need for hardware and energy in supporting AI advancements. The explosive growth in compute demand can be seen in the performance of Nvidia, a leader in AI hardware and software solutions, which has seen its quarterly data centre revenue growing 154% yoy to $26b accounting for 86% of its total revenue for the quarter. The guidance for further growth clearly suggests that the surge in demand is not going to slow down anytime soon.

Despite the substantial growth and opportunities presented by AI, the current market landscape poses significant challenges:

• High Entry Barriers: Substantial capital investment and technical expertise are required to participate in the AI market leaving smaller organisations on the sidelines.

• Concentration of Capital: With large corporations such as Nvidia attracting a major chunk of the capital, smaller players do not have the resources to take part in this technological revolution.

• Limited opportunity: Due to the nascent stage of this technology, there is a lack of adequate knowledge and information which, in turn, has kept the wider public away from this significant growth opportunity.

These challenges can be resolved by AI-Fi (AI Finance), a financial framework centred around AI-focused assets and AI-driven services via:

• Tokenised AI Compute: AI-Fi enables asset owners to monetise their computing resources through tokenisation, creating an open market while maintaining control thereby lowering barriers to entry fostering inclusivity and broader participation.

• Enhanced Security and Transparency: Since the entire history is onchain, it is easy to demonstrate the chain of custody and ownership as well as ensure necessary compliance enforcements on privacy and consent regulations.

• Fair Economics and Innovative Monetisation: Tokenisation allows AI value chain asset owners to monetise future revenue streams while providing network rewards to users who participate strengthening the network.

• Composability: By being integrated into other networks and DeFi protocols, tokenised AI assets form powerful new types of onchain primitives.

• Enhanced Liquidity: Advanced AI algorithms can provide efficient risk management and liquidity solutions thereby removing the inefficiencies in financial markets.

• Simplified UX: Autonomous AI agents will streamlined user onboarding as well as abstract away the complexities involved in blockchain and financial transactions.