Worldwide spending on blockchain solutions is on a major upward trajectory, according to the latest research. The number of businesses looking to take advantage of blockchain and distributed ledger technology (DLT) is increasing, and use cases are expanding as well.
Growth and maturation of blockchain
In fact, blockchain spending is forecast to grow to an incredible $2.9 billion in 2019. This would represent a growth of more than 88 percent over the $1.5 billion spent on the technology in 2018, according to the “Worldwide Semiannual Blockchain Spending Guide” published by International Data Corporation (IDC).
IDC expects global blockchain spending to continue to grow rapidly throughout the 2018-2022 forecast period – reaching a total of $12.4 billion in 2022, with a five-year compound annual growth rate (CAGR) of 76 percent.
James Wester, research director for Worldwide Blockchain Strategies at IDC, noted, “Blockchain is maturing rapidly, and we have reached an inflection point where implementations are moving quickly beyond the pilot and proof-of-concept phase.”
It’s a good sign for a nascent industry that is quickly moving into the mainstream.
New industries and new use cases
The majority of blockchain spending in 2019 will continue to come from the financial sector, according to the IDC report. Banking, securities and investment services, and insurance industries are forecast to invest a combined $1.1 billion in blockchain solutions this year.
However, the manufacturing and resources sector will also see blockchain spending of an estimated $653 million in 2019, and the distribution and services sector is expected to spend $642 million. These two sectors will account for the fastest growth in blockchain spending over the five-year forecast period.
For smaller companies, there’s a great opportunity to invest in blockchain solutions for IT and other business services, as these will account for nearly 70 percent of all blockchain spending in 2019. IT services in particular will see additional new investment through 2022, signaling the importance of blockchain adoption over time.
Aside from the services category, the second-fastest increase in spending will come from businesses investing in blockchain platform software.
Outlook from blockchain researchers
Jessica Goepfert, IDC’s program vice president of Customer Insights & Analysis, commented:
The use cases that comprise the blockchain opportunity are developing as swiftly as the technologies enabling it. While spending for more developed use cases in the financial sector like trade finance and cross-border payments is still healthy and growing strong, relative to six months ago we’ve seen an acceleration in spending across a variety of other areas, such as energy settlements and warranty claims.
Additionally, a recent survey by software development firm Globant found that two-thirds of key decision makers and business leaders are intent on investing in blockchain solutions, viewing it as a “current tech initiative.”
Blockchain implementation is nonetheless still in its infancy, and businesses are poised to make explosive innovations in the near future using DLT. For anyone who would like to explore this groundbreaking technology and its implications and potential uses for business, we’re here to help!