The global blockchain technology market size is estimated to grow at a CAGR of 38.6% from 2020 to 2026. Blockchain usually referred as Distributed Ledger Technology (DLT) enables secure transaction over a ledger database which is shared by all the parties on a distributed network. This database stores all the transactions which occurs in the network, thus enabling irreversible transaction history. Due to this major advantage, the Blockchain technology has drawn attention majorly from the financial sector. Another major advantage of this technology is the enhanced security such as cryptography which ensures immutable transactions. Some of these factors have pushed the market significantly and the market for blockchain technology is estimated to reach USD 16.82 billion by 2026.
Along with different financial institutions, there are many FinTech companies which are interested in Blockchain technology. Major companies have started working on the platform owing to the growing list of potential applications across various domains. There has also been a significant increase in the growth of new start-ups which are focusing majorly in the blockchain technology. These new ventures are being fueled by VC funding which have increased significantly for companies related to blockchain. Even though with numerous advantages, there are some factors which act as restraints for this technology. The major challenge faced by this technology are the regulations from various governments. There is no single regulatory authority and major countries have their own governance and regulations. Along with the regulations, major roadblocks for the adoption of this technology are the technical hurdles and cyber threats. Since all the transactions are carried out on nodes in the network, growing number of cyber-attacks is the major hurdle to the adoption of this technology. Despite of the fact that the blockchain technology market is battling with administrative vulnerabilities and security concerns, it is expected that this technology would gain a lot of traction in the coming years.
With the growing adoption of the Bitcoin and other cryptocurrencies, there are several consortiums which have been established worldwide. Among those R3 is one of the biggest and includes more than 70 banks and financial institutions from the world as their members. They have also launched an open source distributed ledger platform called as Corda which would enable the usage of blockchain technology. The financial services sector stands to be profited the most from this technology, however the adoption can be seen in other sectors as well. The technology and media sector use this technology for Internet of Things and for low priced micropayments. Similarly, E-commerce and retail sector is adopting this technology for the payments of retail transactions and digital signatures. Governments and public sector are aiming to adopt this technology for registering government assets and for securing a faster and error free voting mechanism.
The adoption of blockchain technology is high in the North American region with the market size of over 40%. For Example, U.S. stock exchange Nasdaq has launched a blockchain prototype platform called as ‘Nasdaq Linq’ which can be used for trading the shares of private companies. The Asia-Pacific region is also predicted to join the bandwagon of this growing market owing to various disruptions in the markets of China, India and Australia. For Example, Australian Securities Exchanged along with Digital Asset Holdings are developing a private blockchain to replace ASXs clearing and settlement platform.
Major industry players in this market include R3, Microsoft, Samsung, IBM, Deloitte, BTL Group, Linux Foundation which are proactively working towards the development of this technology.