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Charting Disruption
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GLOBAL
X
ETFS
|
OUTLOOK
FOR
2022
&
BEYOND

CHARTING
DISRUPTION




Wall
Street
Journal
Custom
Content
and
Global
X
ETFs
present
a
guide
to
the
trends,
technologies
and
bold
ideas
transforming
our
world—and
what’s
next.



Scroll to explore



DISRUPTIVE TECHNOLOGY

From blockchain to electric vehicles, these innovations are among the key forces
shaping our future.


2:23












DISRUPTIVE TECHNOLOGY


AUTOMATION MEETS INNOVATION:
ROBOTICS AND AI ENTER A SWEEPING
NEW PHASE OF ADOPTION

We’ve reached the moment when the twin technologies of robotics and artificial
intelligence (AI) are set to bring about the long-anticipated transformation of
industries via automation. Pervasive supply chain disruptions could push an
increase in adoption as businesses trade a globally dependent approach for
onshore manufacturing and logistics. Add the challenges of aging populations and
rising labor costs to the mix, and you have a compelling impetus for
organizations to experiment with technologies supporting automation.

While some jobs are simpler to automate than others (or more accurately,
automate elements of), robotics, AI and machine learning are already reducing
costs and powering productivity in industries from health care to education.
Ultimately, they are likely to change the very nature of work.

By 2026, the global robotics market could expand to $510 billion and the AI
market could reach $300 billion.



In some countries, robotics could drive a 30% productivity increase.



While few occupations can be entirely automated, an estimated $713 billion worth
of tasks in the U.S. could be automated with machine learning.



Autonomous vehicle technology could see a tenfold improvement in performance by
2030 as AVs “learn” by processing data, requiring less frequent human
interference.


Sources: Global X ETFs, calculation based on Mordor Intelligence; Facts and
Factors, Jun 2021; Boston Consulting Group; California DMV & NHTSA, estimates
from Global X ETFs.

> AI is our generation’s general purpose technology. Ultimately, I believe it’s
> going to drive huge productivity gains.
> 
> 
> Erik Brynjolfsson
> Professor and Director,
> Stanford Digital Economy Lab

Ratcheting Up
the Robotics
The global industrial robotics market is expected to more than double in size by
2030, reaching $37 billion.
$355B $37B $16B 2030 2021 INNO V A T O R S EARL Y ADOPTE R S EARL Y MAJORITY LA
TE MAJORITY LA G G ARDS
Source: Global X ETFs Research, as of Nov 3, 2021.
View larger
Key drivers
of adoption


PLAYING CATCH-UP

Countries such as South Korea and Singapore already have far higher robotics
usage than the U.S. or China. There’s likely to be global pressure to increase
usage of robots.


ATTRACTIVE ECONOMICS

Labor costs are rising around the world, as the price of robots keeps falling.
At the same time, robots are becoming more technologically advanced and
productive.


DEALING WITH DISRUPTION

Caused by issues from climate change to geopolitical tensions, supply chain
disruptions are becoming more common—and robots can help counter them.


OLD PROBLEM

Aging populations in countries such as Japan will require the reliance on more
robots to fill industrial demand.


PLAYING CATCH-UP

Countries such as South Korea and Singapore already have far higher robotics
usage than the U.S. or China. There’s likely to be global pressure to increase
usage of robots.


ATTRACTIVE ECONOMICS

Labor costs are rising around the world, as the price of robots keeps falling.
At the same time, robots are becoming more technologically advanced and
productive.


DEALING WITH DISRUPTION

Caused by issues from climate change to geopolitical tensions, supply chain
disruptions are becoming more common—and robots can help counter them.


OLD PROBLEM

Aging populations in countries such as Japan will require the reliance on more
robots to fill industrial demand.


PLAYING CATCH-UP

Countries such as South Korea and Singapore already have far higher robotics
usage than the U.S. or China. There’s likely to be global pressure to increase
usage of robots.

 * 1
 * 2
 * 3
 * 4


DISRUPTIVE TECHNOLOGY


BLOCKCHAIN:
A BANKABLE MOMENT FOR THE
TECHNOLOGY ENABLING CRYPTOCURRENCY

Cryptocurrencies have grown up over the last few years. The thousands of coins
in circulation now represent trillions of dollars in market capitalization.
Global banks have taken notice, and we’re beginning to see once-wary
institutional investors take their first steps into the world of crypto.

But blockchain is bigger than any individual currency. As the decentralized
digital ledger behind crypto, its potential uses run the gamut from
strengthening global supply chains to authenticating luxury goods. At the same
time, its supporting role in tokenization (think non-fungible tokens, or NFTs)
could fundamentally transform the real estate industry, turning properties into
liquid, tradable digital assets.

In Q2 of 2021, institutional investors were responsible for 69% of total
cryptocurrency trade volume on Coinbase, up from 20% in 2018.



The art-fueled NFT market has reached nearly $5 billion in total transaction
volume since 2020.



62% of cryptocurrency owners entered the asset class within the past two years.



Two-thirds of crypto owners identify a 0%-10% allocation as ideal for their
portfolio, highlighting room for growth.


Sources: Coinbase; NonFungible.com, as of Sep 2021; Global X ETFs survey, Oct
2021.
Cryptocurrency
Charges Ahead
Digital currencies could more than triple in market capitalization by 2030,
reaching $10 trillion.
2030 2021 $4 7T $10T $3T INNO V A T O R S EARL Y ADOPTE R S EARL Y MAJORITY LA
TE MAJORITY LA G G ARDS
Sources: CoinMarketCap, as of Oct 19, 2021; Boston Consulting Group.
View larger
Key drivers
of adoption


INFLATION HEDGE

Most cryptocurrencies have a finite supply, making them more resistant to
inflation than fiat currencies.


INSTITUTIONAL APPEAL

More institutional investors are buying cryptocurrencies to take advantage of
the uncorrelated nature of the asset class.


DECENTRALIZED NATURE

Peer-to-peer transactions on public blockchains enable users to conduct
financial transactions faster and without back office paperwork or a third
party.


INFLATION HEDGE

Most cryptocurrencies have a finite supply, making them more resistant to
inflation than fiat currencies.


INSTITUTIONAL APPEAL

More institutional investors are buying cryptocurrencies to take advantage of
the uncorrelated nature of the asset class.


DECENTRALIZED NATURE

Peer-to-peer transactions on public blockchains enable users to conduct
financial transactions faster and without back office paperwork or a third
party.


INFLATION HEDGE

Most cryptocurrencies have a finite supply, making them more resistant to
inflation than fiat currencies.

 * 1
 * 2
 * 3


DISRUPTIVE TECHNOLOGY


MOBILITY:
IT’S PEDAL TO THE METAL ON THE
ROAD TO ELECTRIFICATION

The auto industry is on the cusp of an inflection point decades in the making as
electric vehicles (EVs)—once exclusively the domain of the luxury buyer—finally
accelerate into the mainstream.

Why now? For one, the high cost commonly associated with EVs could soon come
down thanks to batteries that rely on iron-based lithium ion. Meanwhile,
investment in charging infrastructure will go a long way toward relieving the
hesitations some consumers still have around EV driving range. Add billions of
dollars in electrification commitments from vehicle manufacturers that see which
way the wind is blowing, and you have a potentially historic moment in the auto
industry’s 130-year history.

37% of Americans would buy an electric vehicle if it cost the same as a
traditional car—more than the 25% that would stick with the latter.



EV costs could fall 24% by 2030, with ~4% of the total cost decline coming from
switching to less expensive iron-based lithium ion batteries.



Policy changes in the United States could push $7.5 billion into EV charging
infrastructure, with the number of stations increasing sevenfold.



EVs will drive the majority of lithium’s incremental growth, but
underinvestiment in lithium mining is expected to lead to a shortage in 2022,
putting some automakers’ ambitious EV goals at risk.


Sources: Global X ETFs; U.S. Department of Energy, Cubit Planning, Tesla;
Albemarle, Benchmark Mineral Intelligence.

> By the middle of this decade, it’ll be cheaper to buy an electric vehicle than
> it will be to buy a gasoline vehicle. Every auto OEM sees this.
> 
> 
> Ramez Naam
> CO-CHAIR, SINGULARITY UNIVERSITY

Electrified Mobility
Gaining Fast Traction
By 2030, EVs could reach a 36% penetration rate, representing a $1.4 trillion
opportunity.
Sources: International Energy Agency, McKinsey & Company.
View larger
Key drivers
of adoption


COSTS DROPPING

Falling lithium-ion battery prices are expected to attract more cost-sensitive
consumers to EVs.


AUTOMAKERS ON BOARD

Major OEMs are investing billions to electrify their model ranges over the next
10 to 15 years.


FAVORABLE ACTION

Governments in the U.S., China and Europe are enacting policies and rolling out
subsidies to accelerate adoption of EVs.


COSTS DROPPING

Falling lithium-ion battery prices are expected to attract more cost-sensitive
consumers to EVs.


AUTOMAKERS ON BOARD

Major OEMs are investing billions to electrify their model ranges over the next
10 to 15 years.


FAVORABLE ACTION

Governments in the U.S., China and Europe are enacting policies and rolling out
subsidies to accelerate adoption of EVs.


COSTS DROPPING

Falling lithium-ion battery prices are expected to attract more cost-sensitive
consumers to EVs.

 * 1
 * 2
 * 3


PEOPLE AND DEMOGRAPHICS

With immersive technologies driving new interactive experiences, from the
metaverse to telehealth, physical is now digital.


2:48












PEOPLE AND DEMOGRAPHICS


THE FUTURE OF HEALTH CARE:
GENOMICS, AI AND TELEMEDICINE
ARE OPENING THE DOOR TO A
NEW ERA

If there’s one term to describe the next step in health care, it’s
“patient-centric.” Research into the links between genetics and disease is
fueling new forms of therapeutics that could potentially treat—or even cure—some
of the world’s most prevalent conditions. Some of these drugs have already had
an extraordinary impact on global health, such as the mRNA vaccines whose
development was accelerated by the pandemic.

At the same time, the health care sector is entering a new age of digital
sophistication. Telemedicine, analytics and remote patient monitoring (think
wearable health devices) could pave the way for care that’s not only more
efficient, but also better tailored to an individual patient’s needs.

A new class of genetic medicines could address diseases impacting millions of
people, including cancer, cardiovascular diseases, dementia and HIV/AIDS.



Machine learning and artificial intelligence (AI) are helping to speed up
vaccine development. Using AI tools, the genetic sequence for COVID-19 was
decoded in just 40 hours.



$28 billion in U.S. venture funding is predicted to be invested in digital
health in 2021, more than three times the $7.9 billion invested in 2019.



84% of connected-device users (such as people with wearable glucose monitors)
believe the technology helps them improve their health.


Sources: Global X ETFs Telemedicine & Digital Health Survey, Oct 2021.
Sequencing Soars,
Cost Plummets
As the volume of genome sequencing has grown in recent years, the cost per
genome has fallen precipitously.
Cost per genome ($) # o f Sequences $100 , 00 0 , 000 $10 , 00 0 , 000 $1 , 00 0
, 000 $100 , 000 $10 , 000 $1 , 000 $100 10 , 00 0 , 00 0 , 000 1 , 00 0 , 00 0
, 000 100 , 00 0 , 000 10 , 00 0 , 000 2002 2004 2006 2008 2010 2012 2014 2016
2018 2020
Sources: National Human Genome Research Institute;
National Center for Biotechnology Information.
View larger


83% OF RESPONDENTS EXPECT TO MAINTAIN OR INCREASE UTILIZATION OF TELEMEDICINE IN
THE FUTURE.

Source: Global X ETFs Telemedicine & Digital Health Survey, Oct 2021.
Doctors Go Digital
Telemedicine’s share of U.S. medical claims shot up early in the pandemic. While
that initial spike faded, adoption remained substantially higher than
before—suggesting a paradigm shift.
0 . 2% 7 . 1% 0% 2% 4% 6% 8% 10% 12% 14% 2019 2020 JAN FEB MAR APR MA Y JUN JUL
AUG SEP OC T NO V DE C
Source: FairHealth, Monthly Telehealth Tracker, accessed Oct 2021.
View larger


PEOPLE AND DEMOGRAPHICS


THE DIGITAL ECONOMY’S NEXT STEP:
EXPANDING TO TOUCH ALMOST EVERY
FACET OF OUR DAILY LIVES

Every day, 2.5 quintillion bytes of data—two and a half billion billion strands
of information—are created by our online activities, from cloud-based gaming to
e-commerce and beyond.

That volume of data is only likely to increase as our lives (and economies)
become more and more digital. The remote-work era is already impelling
businesses to adopt cloud-based software-as-a-service (SaaS) solutions and
allocate additional cybersecurity funding. Meanwhile, the emerging concept of
the metaverse points to a more immersive way to work, play and shop—and could
further narrow the gap between our physical and digital lives.

In the U.S., the digital economy expanded from 7.8% to 9.6% of the GDP between
2005 and 2019—with recent forces expected to drive that share even higher.



SaaS market share is projected to grow from just 31% of software sales in 2020
to more than 80% by the end of this decade.



Today’s relatively niche market for AR, VR and MR (mixed reality) products could
grow to over $296 billion by the end of 2024.



Social commerce, where consumers make purchasing decisions on social media
platforms, is already a $352 billion market in China.


Sources: U.S. Bureau of Economic Analysis; Global X ETFs estimates, ITCandor;
Mordor Intelligence, Boston Consulting Group, 2021; eMarketer, Global X ETFs.

> The pandemic, horrific as it has been for many people, has accelerated the
> digitization of the economy. That’s driving more rapid change than we would
> have seen otherwise.
> 
> 
> Erik Brynjolfsson
> Professor and Director,
> Stanford Digital Economy Lab

Online Shopping
Spree
E-commerce penetration, propelled in part by the pandemic, is expected to reach
over 30% by 2030.
13 . 6% 27 . 6% 31 . 6% 0% 5% 10% 15% 20% 25% 30% 35% Actuals F orecast P ost-C
O VID F orecast P r e -C O VID 2000 2001 2002 2003 2004 2005 2006 200 7 2008
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
2025 2026 2027 2028 2029 2030
Sources: U.S. Census Bureau, Global X ETFs.
View larger


INNOVATION IN THE PHYSICAL WORLD

Interlinked goals around infrastructure, climate and sustainability will change
our relationship to the physical environment.


3:17












PHYSICAL ENVIRONMENT


THE PATH TO DECARBONIZATION:
INNOVATIVE TECHNOLOGY IS CRITICAL TO
ADDRESS CLIMATE CHANGE

The planet’s temperature is on course to warm by 3 degrees Celsius by 2100. But
even a 2-degree increase could have a vast, destabilizing impact, causing issues
from extreme drought and heat events to increased risk of civil unrest and
humanitarian crises.

Decarbonization could help limit the effects of climate change, but meeting
clean energy goals will depend on increased investment in clean technologies.
The good news is that the transition to renewables like wind and solar energy is
well underway and poised to accelerate, while innovations in carbon capture and
green hydrogen could play powerful roles as well.

By 2050, cumulative investment across clean technologies is projected to reach
between $94 trillion and $131 trillion, depending on the decarbonization
scenario.



Over the last decade, renewables grew from 20% to 29% as a share of electricity
generation—a growth eight times faster than traditional sources.



More than $3 trillion was invested in renewable energy sources between 2011 and
2020.



Average government spending on energy research and development (2014-2020) was
$29 billion per year.


Sources: International Energy Agency & Global X ETFs, 2021.

> The rise of clean energy and clean technology is a huge boon to the world. Not
> only does it help us reduce carbon emissions, it’ll help us eliminate 7
> million deaths a year from air pollution.
> 
> 
> Ramez Naam
> Co-Chair, Singularity University

The Sun’s Shining
on Renewables
Renewable energy—from solar, wind and hydro power—has climbed as a portion of
total global energy production over the past decade. Its growth will need to
accelerate significantly in the coming decades to meet net-zero emissions goals
and curb climate change.
61% 88% 1999 2000 2001 2002 2003 2004 2005 2006 200 7 2008 2009 2010 2011 2012
2013 2014 2015 2016 2017 2018 2019 2020 2021 2030 2035 2040 2045 2050 15% 30%
45% 60% 75% 90% Hist orical Future Share Required 29% 20%
Sources: BP, Jul 2021; International Energy Agency, Apr 2021.
View larger
Key drivers
of adoption


MISSION CRITICAL

Recognition that the threat of climate change is worsening has accelerated the
shift toward clean energy.


MOVING THE NEEDLE

Spurred by opportunity and supportive policy, private and public sector
investment has poured into renewables over the past decade, driving economies of
scale and innovation for key technologies.


THE PRICE IS RIGHT

Renewables’ levelized cost of electricity (LCOE)—the revenue required to build
and operate a source over a cost recovery period—plunged in the past decade,
making renewable power cheaper than power from fossil fuels.


MISSION CRITICAL

Recognition that the threat of climate change is worsening has accelerated the
shift toward clean energy.


MOVING THE NEEDLE

Spurred by opportunity and supportive policy, private and public sector
investment has poured into renewables over the past decade, driving economies of
scale and innovation for key technologies.


THE PRICE IS RIGHT

Renewables’ levelized cost of electricity (LCOE)—the revenue required to build
and operate a source over a cost recovery period—plunged in the past decade,
making renewable power cheaper than power from fossil fuels.


MISSION CRITICAL

Recognition that the threat of climate change is worsening has accelerated the
shift toward clean energy.

 * 1
 * 2
 * 3


PHYSICAL ENVIRONMENT


FOOD AND WATER:
HIGH-TECH SOLUTIONS CHART A
COURSE TOWARD SUSTAINABILITY

The interconnected challenges of climate change, resource scarcity and global
population growth require re-imagining how we approach food and water security.

Innovation is coming from all corners. AI-driven precision farming could reduce
agriculture’s fossil fuel and water use, while advances in plant-based and
lab-grown meat could be a mitigating force against key climate challenges. In
fact, it’s very possible that in the coming decades, the bluefin tuna on your
dinner plate could be sourced not from the ocean, but from a bioreactor in the
American Midwest.

Sensors measuring moisture, nutrient levels and other soil qualities could
reduce the farming industry’s water use by 20%-40%.



To grow one ton of lettuce, a renewable vertical farm would use 6 kiloliters of
water, compared to the 118 kiloliters required by a traditional U.S. farm.



Bioreactors, which are high-tech devices that are used to cultivate lab-grown
meats, could become a $16 billion market by 2027.



Seawater desalination, a process that makes ocean water drinkable, could help
solve global water shortages. Capacity increased fivefold from 2000 to 2020,
reaching 44 billion cubic meters per year.


Sources: The Nature Conservancy; Global X ETFs; Global X ETFs analysis of Global
Water Institute Desal Data, 2021.

> There is a greater sense of urgency now to start exerting some control over
> our global supply of food, because we have these incredible uncertainties that
> we have to contend with.
> 
> 
> Amy Webb
> CEO, Future Today Institute

Feeding the Future
Alternative foods—–including meat, milk and other dairy—could reach 4.2% market
share by 2030, representing a $92 billion opportunity.
0 $10B $20B $30B $40B $50B *F orecast Global Alt ernati v es t o Milk P roducts
Global Alt ernati v es t o M eat P roducts Other Dair y P roducts 2020 2021*
2022* 2023* 2024* 2025* 2026* 2027* 2028* 2029* 2030*
Source: Global X ETFs.
View larger
Key drivers
of adoption


UNSUSTAINABLE PRACTICES

Traditional agriculture is putting a huge strain on the planet’s resources, with
36% of global emissions traced back to livestock.


SHIFTING SENTIMENT

Consumers are increasingly seeking out healthier, plant-based foods, as well as
those that can help fight climate change. A recent Global X ETFs survey found
that 80% of Americans either have purchased an alternative meat product or are
open to doing so in the future.


UNSUSTAINABLE PRACTICES

Traditional agriculture is putting a huge strain on the planet’s resources, with
36% of global emissions traced back to livestock.


SHIFTING SENTIMENT

Consumers are increasingly seeking out healthier, plant-based foods, as well as
those that can help fight climate change. A recent Global X ETFs survey found
that 80% of Americans either have purchased an alternative meat product or are
open to doing so in the future.


UNSUSTAINABLE PRACTICES

Traditional agriculture is putting a huge strain on the planet’s resources, with
36% of global emissions traced back to livestock.

 * 1
 * 2


PHYSICAL ENVIRONMENT


REVITALIZING INFRASTRUCTURE:
CHANGING NEEDS REQUIRE INVESTMENT
IN DATA AND CONNECTIVITY AS
MUCH AS ROADS AND BRIDGES

There is wide consensus that many of the United States’ roads, bridges and
utilities are in need of improvement, particularly as the realities of climate
change demand new levels of resilience.

But physical infrastructure is only one dimension of the world’s future needs.
As the global economy becomes more dependent on connectivity and data, digital
infrastructure could be equally essential with the rise of smart cities,
AI-optimized supply chains and 5G networks.

Over the next 10 years, U.S. infrastructure will require an investment of $2.5
trillion to avoid the country’s risk of losing $10 trillion in GDP by 2039.



By 2050, almost 70% of the world’s population could live in cities, putting new
strains on urban infrastructure.



Internet of Things (IoT) connections could double to 26.4 billion by 2026.



Data center investment is expected to increase from $245 billion in 2019 to $432
billion in 2025 to support the growth of autonomous vehicles, smart grids and
other forms of tech-based infrastructure.


Sources: American Society of Civil Engineers, 2021; United Nations, May 2018;
Ericsson, Jun 2021; Frost & Sullivan, Jan 2021.
Going Urban
The world’s ballooning population—which could rise another 25% by 2050—coupled
with an ongoing migration from rural areas to cities, is straining existing
urban infrastructure and requiring the building of new roads and public transit
systems.
R ural Urban 0B 2B 4B 6B 8B *F orecast 19 50 19 55 19 60 19 65 19 7 0 19 75 1980
1985 1990 199 5 2000 2005 2010 2015 2020* 2025* 2030* 2035* 2040* 2045* 2050*
Source: UN, “World Urbanization Prospects 2018.”
View larger


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CHARTING DISRUPTION



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may no longer be true after the date indicated. Any forward-looking statements
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change over time. Actual results could differ materially from those anticipated.


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 * Food and Water
 * 21st Century Infrastructure
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