Worldwide spending on blockchain technology solutions is forecast to reach $2.9 billion in 2019, an increase of 88.7% from the $1.5 billion spent in 2018, according to a newly updated Worldwide Semiannual Blockchain Spending Guide from International Data Corporation (IDC).
IDC expects blockchain spending to grow at a robust pace over the 2018-2022 forecast period with a five-year compound annual growth rate (CAGR) of 76.0% and total spending of $12.4 billion in 2022.
“Blockchain is maturing rapidly, and we have reached an inflection point where implementations are moving quickly beyond the pilot and proof of concept phase,” said James Wester, research director, Worldwide Blockchain Strategies.
Global blockchain spending will be led by the financial sector, where the banking, securities and investment services, and insurance industries will invest more than $1.1 billion (combined in blockchain solutions this year), according to the report.
The manufacturing and resources sector, driven by the discrete and process manufacturing industries, and the distribution and services sector, led by the retail and professional services industries, are forecast to see blockchain spending of $653 mn and $642 mn, respectively this year.
The manufacturing and resources sector will see the fastest growth in blockchain spending over the 2018-2022 forecast with a five-year CAGR of 77.6%, followed closely by the distribution and services sector with a CAGR of 77.1%.
Cross border payments & settlements and trade finance & post-trade/transaction settlements are the two blockchain use cases that will receive the most investment ($453 million and $285 million, respectively) in 2019.
The banking industry will be the largest investor in both use cases. Manufacturing will focus much of its blockchain investment in lot lineage/provenance use cases and asset/good management use cases while identity management use cases will receive significant investments from the banking, government, and healthcare provider industries.
The US will be the geographic region that will see the largest blockchain spending in 2019 ($1.1 billion), followed by Western Europe ($674 million) and China ($319 million). All nine regions covered in the spending guide will see phenomenal spending growth over the 2018-2022 forecast period led by Japan and Canada with five-year CAGRs of 110% and 90%, respectively.