Almost a quarter of a million Australians could be making, trading and securing cryptocurrency and digital assets by 2030, and it doesn’t have to make the lights go out.
Future high-impact careers include supercomputing technicians, market analysts and dealers, security and software architects, lawyers, data scientists and auditors, according to a report by Ernst & Young released on Tuesday.
“Cryptocurrencies and digital assets are rapidly emerging industries and will be a big part of our future economy,” chair of the Senate’s financial technology committee Andrew Bragg said.
“There is no time to waste.”
The cryptocurrency, digital asset and blockchain economy could become bigger than Australia’s tourism, agriculture and energy industries, the report found.
With uptake supported by new regulations, the digital asset ecosystem could deliver $250 billion in economic benefits over the next decade.
The report commissioned by digital infrastructure provider Mawson found scope for large gains in finance, professional services and the health sector.
“Given the energy-intensive nature of many crypto-related activities, the resource and energy industries, including renewables, also stand to benefit strongly.”
Mawson and renewable energy investment manager Quinbrook recently collaborated to power Mawson’s 20-megawatt Byron Bay crypto-mining facility with Quinbrook’s nearby biomass renewable energy plant.
The cryptocurrencies and digital assets industry could generate $68.4 billion – about 2.6 per cent of the national economy – by 2030 and employ 205,700 people, or 17 times the current crypto workforce, the report says.
While the sector may create a “meaningful economic impact”, crypto mining has a significant energy footprint.
Bitcoin alone is projected to consume 0.5 per cent of worldwide electricity consumption in 2021 or 43 per cent of the electricity consumption of the global banking sector.
Crypto mining involves nodes connected to a blockchain network solving cryptographic algorithms known as “hash functions”.
But a new method is expected to cut the large quantities of energy consumed as cryptocurrency holders can delegate their stake to one operator, or node, rather than all competing against each other.
Three of the world’s top 10 cryptocurrencies – Cardano, Solana and Polkadot – use this mechanism, the report says.
More partnerships between data infrastructure and energy infrastructure companies are also tipped.
Mawson and renewable energy investment manager Quinbrook recently collaborated to power Mawson’s 20 megawatt Byron Bay crypto-mining facility with Quinbrook’s nearby biomass renewable energy plant.
The report says blockchain-enabled financial instruments can make payments cheaper and faster, open up new forms of ownership and asset classes, and spur investment in crypto related infrastructure.
Blockchain technology enables direct trade between parties on a decentralised public or private network, as an alternative to large traditional institutions and established ways of making payments.
Using a digital ledger, transactions are recorded as “blocks” and connected to the “chain” of previous transactions.
Each new block is secured to the chain of previous transactions by algorithms and can’t be altered.
These characteristics allow cryptocurrency to be securely traded peer-to-peer without the involvement of intermediaries such as banks or government.
Companies such as Commonwealth Bank and PayPal allow customers to hold and use cryptocurrency.
EY expects other Australian banks to follow.
Banks could also provide custody services to help secure assets from hackers, the report said.
Data management services are expected to expand, spurring innovation as computing and storage are pushed to their limits.
Insurance is also becoming important as the surging value of online wallets and exchanges become an attractive target for criminals.
But Australia’s potential as a leader in the sector needs regulatory support and proper safeguards amid concerns about investor protection, market integrity and law enforcement.
“Australia does not yet have fit-for-purpose regulatory systems,” the report says.
Treasurer Josh Frydenberg has announced new regulations that have been touted as the biggest overhaul of payments in 25 years.
But laws still need to be drafted and passed by parliament, after the federal election.