When the European Investment Bank issued a €100 million digital bond on a public blockchain in April 2021, it was the first bond ever issued by a supranational institution on Ethereum. Three years later, the EIB had issued multiple digital bonds, Goldman Sachs had built a platform to facilitate them, and the total market for tokenised real-world assets exceeded $5 billion. Blockchain applications in finance are expanding not because the technology is new but because the initial applications proved viable and created demand for the next set. The global blockchain market reached $31.18 billion in 2025, per Fortune Business Insights, with the BFSI sector accounting for 23.52% and growing faster than the overall market.
From Three Applications to Thirty
In 2020, blockchain in finance meant three things: cryptocurrency trading, cross-border payments through RippleNet, and a handful of trade finance pilots. By 2025, the application set has expanded to include tokenised bonds, tokenised funds, repo settlement, collateral management, KYC verification, insurance claims automation, carbon credit registries, supply chain financing, central bank digital currencies, decentralised lending, decentralised exchange, stablecoin payments, proof of reserves, regulatory reporting, and digital asset custody.
This expansion followed a pattern. Each successful application created infrastructure that made the next application cheaper to build. Ethereum’s smart contract platform enabled DeFi lending. DeFi lending proved that automated financial products work. That proof gave institutions confidence to launch tokenised funds. Tokenised funds require custody infrastructure. Custody infrastructure enables broader digital asset services. Each layer supports the next.
Data from Chainalysis’s 2024 Global Crypto Adoption Index shows that emerging markets in South and Southeast Asia continue to lead grassroots cryptocurrency adoption, driven by remittance use cases and limited access to traditional banking services.
According to CoinGecko’s 2024 annual crypto report, total cryptocurrency market capitalisation exceeded $3.5 trillion by the end of 2024, reflecting renewed institutional interest following spot ETF approvals in the United States.
83% of financial institutions are exploring or deploying blockchain, per Coinlaw. The 83% figure reflects the breadth of applications now available. An institution that has no interest in cryptocurrency trading might still adopt blockchain for trade finance, repo settlement, or regulatory reporting.
Expansion in Capital Markets
Capital markets applications have expanded most rapidly. Bond issuance was the first capital markets use case, demonstrated by the EIB and World Bank. This has expanded to structured products, money market funds, and private equity.
BlackRock’s BUIDL fund ($500 million in tokenised US Treasuries) proved that mainstream asset managers can use blockchain for fund distribution. Franklin Templeton’s OnChain fund validated the same model on different blockchains (Stellar and Polygon). Hamilton Lane’s tokenised private equity fund showed that blockchain can bring institutional-quality products to a broader investor base by reducing minimum investments from $5 million to $20,000.
Securities lending and repo are expanding on blockchain. JPMorgan’s Onyx handles over $1 billion in daily repo volume. Broadridge’s blockchain platform processed over $1 trillion in cumulative repo transactions. These applications succeeded because they address specific, expensive problems: settlement failure rates of 2% on traditional systems, multi-day settlement delays that tie up capital, and reconciliation costs that consume back-office resources.
Derivatives are a newer frontier. DTCC is exploring blockchain-based post-trade processing for derivatives through various pilot programmes. The derivatives market’s complexity (bilateral contracts, margin management, netting calculations) makes it both harder to blockchain-enable and more valuable to improve. Post-trade processing for OTC derivatives costs the industry billions annually and remains largely manual.
Expansion in Payments
Blockchain payment applications have expanded from cryptocurrency transfers to stablecoin-based B2B payments, payroll, and merchant acceptance.
Blockchain-based cross-border payments handle approximately $3 trillion annually, growing at 45% per year, per Coinlaw. The initial use case was consumer remittances through networks like RippleNet. The application set now includes corporate treasury transfers (JPMorgan’s JPM Coin), vendor payments (Circle’s USDC-based business products), international payroll (stablecoin payments through Deel and Remote), and merchant point-of-sale acceptance (through Stripe’s Bridge integration and BitPay).
Stablecoin payment volume is the primary growth driver. Circle’s USDC alone has processed over $12 trillion in cumulative on-chain transaction volume. Tether’s USDT processes even more. These stablecoins are the payment rail connecting blockchain-based financial applications to the dollar-denominated economy.
The cross-border payments market is valued at $371.59 billion in 2025, per Fortune Business Insights, projected to reach $727.74 billion by 2034. Blockchain’s share of that market is growing as stablecoin infrastructure matures and payment companies integrate blockchain settlement.
Expansion in Compliance and Identity
Compliance applications represent one of the fastest-growing segments. Blockchain analytics firms (Chainalysis, Elliptic, TRM Labs) provide transaction monitoring and anti-money laundering tools for digital asset markets. These tools are now being adapted for broader financial compliance, including sanctions screening and fraud detection across both blockchain and traditional payment rails.
Blockchain-based identity is expanding from simple KYC verification to portable credentials, verifiable attestations, and privacy-preserving proofs. The Ethereum Attestation Service provides on-chain identity verification. Polygon ID offers zero-knowledge proofs that allow users to prove attributes (age, nationality, accreditation status) without revealing underlying data. WorldID, developed by Worldcoin, uses biometric verification to create on-chain proof of personhood.
For financial institutions, these identity solutions address a $6 billion annual KYC compliance cost. A portable KYC credential that travels with the customer between institutions reduces duplicate verification. Singapore’s Project Guardian is testing this model in production, with participating banks sharing KYC attestations on a shared blockchain network.
What Enables Expansion
Three factors enable the continued expansion of blockchain applications in finance.
Infrastructure maturity is the first. The Blockchain-as-a-Service segment accounts for 51.72% of blockchain market revenue, per Fortune Business Insights. Mature BaaS platforms from IBM, AWS, and R3 mean that new applications can be built on proven infrastructure rather than starting from scratch. The cost and time to launch a new blockchain application have dropped by an order of magnitude since 2020.
Developer tooling is the second. Alchemy, Infura, Hardhat, and Foundry provide development, testing, and deployment tools that make blockchain application development accessible to standard software engineers rather than requiring specialised cryptography expertise. The developer ecosystem has grown from a few hundred active developers in 2017 to over 25,000 monthly active open-source contributors in 2024, per Electric Capital.
Regulatory frameworks are the third. The EU’s MiCA regulation, Hong Kong’s digital asset licensing, Singapore’s Payment Services Act, and the UAE’s VARA framework all provide legal clarity for specific blockchain applications. Each new regulatory approval expands the set of applications that institutions can legally deploy.
North America holds 43.80% of the global blockchain market. The expansion of blockchain applications in finance is concentrated in this region because it has the deepest capital markets, the largest financial institutions, and the broadest technology ecosystem. Private blockchains account for 42.47% of enterprise deployments, reflecting institutional preference for controlled environments. As each application proves viable, it creates the conditions for the next, building an expanding ecosystem where the total is greater than the sum of individual applications.
