Blockchain IoT Market Size, Share & Trends Analysis Report By Offering (Hardware, Software, Infrastructure Providers), By Application (Smart Contracts, Data Security, Data communication/sharing, Asset tracking and management), By End-User (Energy and utility, Transportation and Logistics, Manufacturing, Building management, Healthcare, Retail, Wearable and mobile devices, Smart city) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2021-2029

Market Overview

Blockchain IoT, or the combination of blockchain technology and the Internet of Things (IoT), is a significant convergence that addresses critical challenges in the IoT ecosystem. Integrating blockchain and IoT improves security, transparency, and efficiency in the increasing network of networked devices. The rising integration of blockchain and IoT devices enhances security by allowing decentralized and tamper-proof data storage and communication, projected to boost the Blockchain IoT market growth.

Similarly, the growing trend of selectively managing, analyzing, customizing, and sharing data with authorized clients and partners, which gives enterprises better control and flexibility over their data, is expected to drive market expansion throughout the projection period. Furthermore, continued use of technology by leading players is expected to boost market growth.

Market Dynamics

Global Blockchain IoT Market Drivers:

Growing Need for IoT Security

Security is a primary problem in the IoT landscape due to the enormous amount of data created by interconnected devices. Blockchain addresses security concerns by providing a decentralized, tamper-resistant infrastructure that protects IoT data integrity and confidentiality. According to Forbes, by 2023, there will be over 43 billion internet-connected devices. However, Statista predicts that by 2023, there will be around 15.14 billion connected IoT devices. This is nearly twice the global population. Cisco predicts that 500 billion devices will be internet-connected by 2030. Thus, the growing use of online services has exacerbated cyber dangers.

Furthermore, in the healthcare industry, patient data security is crucial. Blockchain IoT solutions securely store and distribute electronic health records (EHRs) created by IoT devices. A blockchain can keep a patient's medical history, vitals obtained via wearables, and treatment data. This ensures that sensitive health information is not altered and may only be accessed by authorized people. The blockchain's cryptography makes unauthorized access or manipulation of patient records much more difficult. Again, a Deloitte poll found that 35% of healthcare and life sciences executives regard blockchain technology as a significant strategic priority. The survey demonstrates the industry's acknowledgment of blockchain's potential to address security and interoperability issues in healthcare systems, including those involving IoT devices.

Moreover, integrating blockchain with IoT devices improves security and privacy protections in vital industries such as healthcare, assuring the integrity and confidentiality of sensitive data while meeting regulatory standards. As blockchain usage in healthcare grows, the advantages of improved security and data integrity provided by blockchain IoT solutions become more apparent. Consequently, these factors will influence the Blockchain IoT market trend during the forecast period.

Global Blockchain IoT Market Restraints:

Regulatory Uncertainties

Regulatory uncertainties impede the adoption and deployment of blockchain Internet of Things (IoT) solutions. The regulatory landscape for blockchain and IoT is changing, and the need for clear guidelines and standards may influence enterprises' desire to invest in and deploy blockchain IoT solutions. Different regions and countries may have varying methods of regulating blockchain and IoT technology. A consistent regulatory framework can make compliance easier for organizations operating abroad. Countries like the United States, Canada, South Korea, Singapore, India, the United Kingdom, and China do not recognize cryptocurrencies as legal money. On the other hand, Australia, Japan, Switzerland, and the European Union see it as legal tender. MiCA, which controls cryptocurrency markets, was adopted by the EU in June 2023. The framework requires enterprises that seek to issue, trade, and protect cryptoassets, tokenized assets, and stablecoins to get a license. The EU has also implemented the Travel Rule for crypto-asset transfers. The Travel Rule aims to prevent money laundering and terrorist financing.

Furthermore, many areas like healthcare and banking have strict data security and privacy requirements. Blockchain IoT solutions in these industries must adhere to specific industry norms, and concerns about compliance can impede adoption. A study published in the Journal of Medical Internet Research (JMIR) found that blockchain applications in healthcare face regulatory difficulties and the need for defined regulations. The study stressed the need for legislative frameworks to address privacy concerns and ensure compliance in healthcare settings.

Global Blockchain IoT Market Opportunity:

Efficient Supply Chain Management

Blockchain IoT solutions provide disruptive opportunities for optimizing supply chain management by enabling end-to-end visibility, transparency, and automation. Organizations may streamline processes, decrease inefficiencies, and increase confidence throughout the supply chain using the strengths of blockchain and IoT. Smart contracts, a characteristic of blockchain technology, enable the automation of supply chain activities by carrying out specified agreements when certain circumstances are fulfilled. This automation eliminates manual involvement, streamlines procedures, and reduces transaction delays. When blockchain becomes capable of delivering value, forward-thinking businesses want to invest. However, blockchain has not provided total value beyond food and pharmaceutical applications. As a result, only 6% of supply chain leaders regard blockchain as a high priority, according to Kenco Group. The growing number of smartphone and tablet subscribers has resulted in the rapid expansion of the E-Commerce industry. According to Experian Plc., 97% of tablet owners purchased their device, and 83% conducted shopping-related activities right before, during, or after visiting a store. This crucial factor opens up prospects for the blockchain market in supply chain management. 

Furthermore, a Deloitte survey discovered that 55% of respondents see blockchain as a vital technology for increasing visibility and traceability in supply chains. The poll demonstrates the growing understanding of blockchain's ability to address inefficiencies and vulnerabilities in traditional supply chain management procedures.

Regional Analysis

North America Dominates the Global Market

The global blockchain IoT market analysis is conducted in North America, Europe, Asia-Pacific, the Middle East and Africa, and Latin America.

North America is the most significant global blockchain IoT market shareholder and is estimated to grow at a CAGR of 5.6% over the forecast period. North America dominates the blockchain IoT market, thanks to significant players like IBM Corporation, Microsoft Corporation, Intel Corporation, Amazon.com, Inc., Cisco Systems, The Linux Foundation, R3, and Filament. Furthermore, the widespread deployment of advanced IoT fuels regional market growth. Statista states North America will have 8 billion Internet of Things connections by 2030. Statista estimates that 92% of individuals in the United States will have internet connectivity by 2023. This is an increase from 75% in 2012. The United States has one of the world's largest online markets, with over 307 million internet users. Furthermore, the region's financial stability opens up many opportunities for new investments and has expanded the use of cutting-edge IoT technology. 

Asia-Pacific is anticipated to exhibit a CAGR of 5.8% over the forecast period. Asia-Pacific is expected to grow in the blockchain IoT market due to high technological adoption, favorable government efforts, and increased ICT sector investments. Singapore is the world's largest user of blockchain technology for cross-border payments and the banking and healthcare industries. Governments in China, Japan, and India have adopted and promoted the usage of this technology. For example, in March 2023, the Society for Electronic Transactions and Security (SETS) and the Unique Identification Authority of India (UIDAI) cooperated to perform research and development in deep technologies, such as IoT security, blockchain technology, and quantum security. It is part of the Indian government's 'Make in India' project, which aims to increase capability and self-reliance in information security. Such government measures are projected to increase demand for technology throughout the region.

Furthermore, the Blockchain-based Service Network (BSN), China's national-level blockchain effort, has announced that blockchain technology will validate the real-name identities of the country's 1.4 billion citizens. This move is sure to raise concerns among data privacy activists. For example, in February 2023, China Telecom, one of China's largest wireless providers with roughly 390 million subscribers, collaborated with Conflux Network, a blockchain technology, to create blockchain-based SIM cards. Also, in November 2022, China's state blockchain infrastructure, Xinghuo Blockchain Infrastructure and Facility, signed an agreement with Malaysian digital service provider MY EG, Services Berhad (MyEG), to own and run an "international supernode" as Beijing expands its international blockchain efforts.

Europe is predicted to see the fastest market growth rate in the worldwide blockchain Internet of Things (IoT) market during the forecast period, owing to technical advancements and innovations by leading companies. Furthermore, according to International Data Corporation, the number of linked IoT devices in Europe is expected to grow from 40 billion in 2023 to 49 billion by 2026. 

Additionally, the European Blockchain Services Infrastructure (EBSI) has always attempted to demonstrate the power of blockchain beyond the hype, particularly by devoting time to investigating feasible use cases for distributed ledger technology. EBSI uses Smart Contracts to realize this revolution of EU public services. For example, on February 14th, 2023, the European Commission announced the European Regulatory Sandbox for blockchain. Sandboxes are controlled settings where businesses can test their products and services while working with relevant regulators.

Segmental Analysis

The global blockchain IoT market is segmented based on offering, application, and end-user.

The market is further segmented by offering Hardware, Software, and Infrastructure Providers.

Hardware accounts for the largest share of the market.

Hardware

The hardware segment accounts for the largest share, owing to the widespread deployment of IoT devices and increased participation in peer-to-peer connectivity. These devices include sensors, actuators, RFID (Radio-Frequency Identification) tags, and other embedded systems that collect and communicate data. Hardware is critical for gathering real-world data and integrating it into the blockchain network. It is the foundation for an interconnected network of Internet of Things devices, allowing data to flow seamlessly from the physical world to the digital ledger. 

Software

On the other hand, the software market is expected to develop the fastest due to the increased requirement for security and connection. Software solutions make it easier to create decentralized applications (DApps) that combine the benefits of blockchain and IoT technology. These applications can automate operations, enforce smart contracts, and provide secure data sharing. Blockchain IoT software examples include smart contract development and deployment platforms, decentralized supply chain management apps, and protocols for safe communication between IoT devices.

The market can be bifurcated by application into Smart Contracts, Data Security, Data Communication/Sharing, Asset Tracking and Management.

Smart Contracts generate the most revenue in the market.

Smart Contracts

Smart contracts have the most significant market share because they provide numerous benefits, such as the automatic execution of specific tasks, corporate collaborations, and business agreements. Smart contracts are self-executing contracts in which the terms of the agreement are encoded directly into code. Smart contracts in Blockchain IoT automate and enforce established rules and conditions for device interactions. These contracts enable trustless and transparent transactions, eliminating the need for intermediaries. Applications include automatic payments, real-time data validation, and conditional action execution based on IoT data.

Data Security

Data security is a top priority in the integration of blockchain and IoT. This application category focuses on using blockchain's cryptographic and decentralized capabilities to protect the secrecy, integrity, and validity of IoT-generated data. Unauthorized access, tampering, and data breaches can be reduced by keeping data in an immutable blockchain ledger. This improves the entire security posture of IoT ecosystems, increasing their resilience to cyber threats.

Based on end-users, the market is sub-segmented into Energy and Utility, Transportation and Logistics, Manufacturing, Building Management, Healthcare, Retail, Wearable and Mobile Devices, and Smart City.

Transportation and Logistics are the major end-users of the market

Transportation and Logistics

Blockchain IoT improves supply chain visibility, asset tracking, and logistics efficiency in transportation and logistics. Applications range from real-time shipment tracking via IoT sensors to transparent and automated intelligent contracts that improve logistics processes. Blockchain and IoT integration improves traceability and lowers inefficiencies in commodities transportation.

Energy and Utility

The energy and utility industries use Blockchain IoT to improve energy-related processes' efficiency, security, and transparency. Applications include smart grid management, peer-to-peer energy trading, and energy consumption monitoring. Blockchain IoT provides decentralized and secure energy transactions, promoting the development of more sustainable and resilient energy systems.

Impact of covid-19

The pandemic had caused a lockdown and temporary shutdown of most of the industry verticals across the globe; thus, negatively impacting the businesses. However, the 3D rendering software market has noted a massive surge during the pandemic due to its ability to showcase the structures, and other projects online, along with a rise in the creativity of the marketing and advertisements sector. Additionally, the pandemic has led to massive growth in the digitalization of almost all the verticals, further driving the market growth.

Recent Developments

• January 2024- Casper Labs will collaborate with IBM Consulting to develop a blockchain-powered solution to improve transparency and auditability for generative AI systems.
• August 2023- Microsoft joined with the Aptos blockchain to integrate AI with web3.
• December 2023- AWS launched its second infrastructure region in Canada, the AWS Canada West (Calgary) Region, giving customers more options to execute workloads with even greater resilience and availability, securely store data in Canada, and serve end users with even lower latency.
• January 2024- Cisco and the OECD launched a groundbreaking research initiative on digital well-being. This alliance strives to promote responsible technology use, fairness, inclusion, and equitable access in a global digital economy.