According to International Data Corporation’s Semiannual Blockchain Spending Guide, worldwide spending on blockchain solutions will reach nearly $2.9 billion in 2019, an increase of 88.7% from the $1.5 billion spent in 2018.

The spending guide quantifies the emerging blockchain market by providing spending data for ten technologies across 19 industries and 15 use cases in 9 geographic regions. 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. The United States 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). Western Europe alone will cover 83% of the total spending, while Central and Eastern Europe will cover 17%. All 9 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.

Blockchain is maturing rapidly

Carla La Croce, senior research analyst for customer insights and analysis at IDC, said: “Interest in blockchain among supply chain industries is seen in the increasing number of use cases for tracking products, such as lot lineage provenance and asset / goods management, from food to luxury goods.” James Wester, research director Worldwide Blockchain Strategies: “Blockchain is maturing rapidly, and we have reached an inflection point where implementations are moving quickly beyond the pilot and proof of concept phase. That is why data on the actual spend on the technology is so vital: it provides the context in which blockchain is evolving. Understanding how and where enterprises are investing their money gives vendors a better sense of where they need to deliver products and services as well as offering technology buyers insight into how their peers are adopting blockchain. It also provides a snapshot of where we can expect to see this new technology disrupt the way enterprise software is delivered.”

Financial sector will lead the global blockchain spending

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 in blockchain solutions this year. 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 million and $642 million respectively this year.

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.

From a technology perspective, IT services and business services (combined) will account for nearly 70% of all blockchain spending in 2019 with IT services receiving additional new investment over the forecast period. Blockchain platform software will be the largest segment of spending outside of the services category and the second fastest growing category overall with a five-year CAGR of 81.2%, following IT services with a CAGR of 82.8%.