Spending on Blockchain Solutions to Reach Nearly $19 Billion in 2024

Organizations are forecast to spend nearly $6.6 billion on blockchain solutions this year, an increase of more than 50% compared to 2020, according to IDC. Spending will continue to see strong growth throughout the 2020-2024 forecast period with a five-year compound annual growth rate (CAGR) of 48.0%.

"This is an important time in the blockchain market as enterprises across markets and industries continue to increase their investment in the technology. The pandemic highlighted the need for more resilient, more transparent supply chains, healthcare delivery, financial services, and so much more, and enterprises around the world have been investing in blockchain to provide that resiliency and transparency," said James Wester, research director, Worldwide Blockchain Strategies.

"What is also very important right now is that we are seeing real interest and investment by corporations, financial institutions, and even governments in areas they previously viewed with some uncertainty such as cryptocurrencies, digital assets, central bank digital currencies, decentralized finance, and stablecoins. This investment will have major implications in a very short time on everything from retail to financial services to capital markets," added Wester.

The leading use case for blockchain in 2021 and throughout the forecast is Cross-Border Payments & Settlements, which uses distributed ledger technology to track, trace, and manage payments and settlements. The second largest blockchain use case is Lot Lineage/Provenance, which is used to verify the origin and authenticity of a product as it moves throughout the value chain. From an industry perspective, banking leads the way in blockchain spending, accounting for nearly 30% of the worldwide total in 2021. Banking will remain the top industry for blockchain spending throughout the forecast although its share of spending will diminish slightly by 2024.

From a technology perspective, IT services and business services (combined) will account for more than two thirds of all blockchain spending throughout the forecast with IT services receiving slightly more investment over the forecast period. Blockchain platform software will be the largest category of spending outside of the services segment and the fastest growing technology category overall with a five-year CAGR of 52.9%.

Spending on blockchain solutions in the United States will be nearly $2.6 billion this year, making it the largest geographic market, followed by Western Europe ($1.6 billion) and China ($777 million). All nine regions covered in the Spending Guide will see exceptional spending growth over the forecast period led by China with five-year CAGR of 54.6% and Central and Eastern Europe (50.0% CAGR).