Blockchain-as-a-Service Market

The Blockchain-as-a-Service Market is expected to grow from USD 3 Billion in 2026 to USD 8.6 Billion by 2033, reflecting strong industry expansion and registering a CAGR of 16.2% during the forecast period from 2026 to 2033.

Blockchain-as-a-service Market to Witness Significant Adoption in BFSI and SMEs

BFSI has been witnessing numerous problems such as inefficient record handling and supervision. Blockchain can act as a cost effective one stop solution to address these challenges in the banking sector, by maintaining transparency and security at the same time. Moreover, rising cross border transactions and demand for digital ledger are likely to fuel growth of blockchain-as-a-service in BFSI sector in the coming years.

Blockchain-as-a-service is a viable solution for companies that outsource technology. The blockchain-as-a-service market is likely to gain significant traction from SMEs owing to flexible transactions and its cost-efficient features. Additionally, the pay-as-you-go model adopted by SMEs to manage IT infrastructure is expected to drive use of blockchain-as-a-service. Moreover, additional benefits in enhancing SCM, payment/ transaction security and record transparency continue to influence adoption of blockchain-as-a-service amongst SMEs.

Vulnerability to Cyber Attacks to Challenge Market Growth

Considerable attention on financial transactions, from a safety standpoint, is being given since the introduction of blockchain-as-a-service. On the back of its complex architecture, sophisticated systems, tools, and skills are essential to hack into blockchain system. However, the blockchain-as-a-service technology is not bereft of cyber-threat vulnerabilities and can become a potential target for hackers, according to NASDAQ analysis. For instance, in 2019, Ethereum Classic, an exchange platform for cryptocurrency, was hacked, wherein transaction history was rewritten, stealing millions. In the same year, by exploiting endpoints that only use wallets to carry out transactions, around US$ 40 million were stolen by hackers via Bitcoin transactions. A constant threat of cyber attacks still looms, questioning the safety standards of blockchain-as-a-service.

Regulations Continue to Influence Growth of Global Blockchain-as-a-service Market

Blockchain-as-a-service is continues to remain influenced by regulations by government bodies worldwide. For instance, approach of EU (European Union) towards blockchain-as-a-service has been optimistic, however, it laid down regulations to it to safeguard public and economic interests of the region. On 10^th January 2020, 5AMLD (5^th Anti-Money Laundering Directive) was signed by EU which stated that crypto service source and cryptocurrency will be under scrutiny of this regulation.

Likewise, US has also maintained a positive outlook towards blockchain-as-a-service, though few rules have been introduced. The regulations regarding blockchain-as-a-service has mostly been at agency level, covering FTC (Federal Trade Commission), SEC (Securities and Exchange Commission), FinCEN (Financial Crimes Enforcement Network), Department of Treasury and IRS (Internal Revenue Services).

Asian countries are also inclined towards use of blockchain-as-a-service, however, to avoid counterfeit cross border transactions, governments are placing stringent regulations. For instance, Japan laid a regulation on Bitcoin in 2018; similarly, India banned cryptocurrency trade in the past. However, present condition in India reflects that there is no policy or law that forbids investment or trading in cryptocurrencies. A new bill named Cryptocurrency and Regulation of Official Digital Currency Bill would be implemented in 2021, the purports of which state that facilitative framework for digital currency would be created and issued by RBI and prohibit private cryptocurrencies but permit certain exceptions in a bid to promote technologies driving these cryptocurrencies such as blockchain-as-a-service and distributed ledger. Moreover, according to Chainanalysis (a blockchain data platform), in its 2021 Global Adoption Index, stated that India ranks second with respect to crypto adoption, being ahead of UK and China, which reflects that increasing adoption is evident and companies and exploit this opportunity in the coming years to gain significant competitive edge.

Collaborations among Tech Companies and Financial Institutions to Scale Up Global Blockchain-as-a-service Market Potential

Strategic collaborations between tech companies and financial institutions have been witnessed. These strategic moves were carried out to broaden the blockchain-as-a-service application area in a bid to enhance its market potential. For instance, in May 2019, JP Morgan partnered with Microsoft. Under this partnership, Quorum – a distributed ledger platform of JP Morgan would be accessible through Azure blockchain. Other developments include tech-tech collaborations. In March 2019, TCS entered into a strategic collaboration with R3 and Microsoft to implement a cross-industry scalable blockchain platform, which would serve as a hub for luxury goods anti counterfeiting, 5G telecom infrastructure, loyalty programs and rewards.

Few of the companies operating in the global blockchain-as-a-service market include IBM, Oracle, SAP SE, R3, Amazon, Microsoft Corporation, Huawei and Accenture.

Key Market Companies

• IBM Corporation
• Microsoft Corporation
• Alibaba Group
• Oracle Corporation
• SAP SE
• Baidu, Inc.
• Accenture Plc
• NTT Data Corporation
• Infosys Limited
• Stratis Group Ltd.

By Component

• Tool
• Service

By Application

• Smart Contracts
• Supply Chain Management
• Payments
• Governance, Risk, and Compliance Management

By Industry

• BFSI
• Energy & Utilities
• Government
• Healthcare and Life Sciences
• Manufacturing
• Telecom
• Media & Entertainment
• Retail & Consumer Goods

By Region

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East & Africa