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The global blockchain AI market size was USD 184.6 million in 2019 and is projected to grow from USD 220.5 million in 2020 to USD 973.6 million in 2027, at a CAGR of 23.6% in the 2020-2027 period. The global impact of COVID-19 has been unprecedented and staggering, with blockchain AI witnessing a positive demand shock across all regions amid the pandemic. Based on our analysis, the global market will exhibit a stellar growth of 19.4% in 2020. The sudden fall in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.
The rising adoption of AI-based blockchain platforms and services among small and medium enterprises (SMEs) to develop blockchain applications, such as payment systems, smart contracts, and others, is likely to fuel the growth of the market. In addition, factors such as the advancement of cryptocurrency are also fueling the popularity and awareness of blockchain AI-based platforms among enterprises.
Increasing investments in projects based on blockchain AI technology by countries such as China, Japan, the US, and the UK are likely to propel the market size during the forecast period. For instance, in October 2020, the European Investment Fund (EIF) and the European Commission (EC) signed the first six equity agreements with venture capital funds in Finland, Austria, Luxembourg, the Netherlands, and Germany to raise around EUR 700 million (USD 851.85 million). The aim is to support investments in the technology industry under Europe's InnovFin AI/BT initiative.
Surging Demand for Innovative Blockchain AI-based Solutions to Accelerate Market Growth amid COVID-19 Crisis
The current coronavirus crisis is challenging the blockchain AI market growth in the short-term and has affected every segment of society, including businesses and individuals. The blockchain and internet ecosystem has been playing a crucial role in accelerating digital transformation initiatives and activities amidst the COVID-19 pandemic. Industries such as healthcare & life sciences, BFSI, telecom & IT, and media & entertainment are leveraging the internet to provide blockchain-related services to consumers. The AI-based technology of blockchain can be used for crisis management, public health data surveillance, securing medical supply chains, donation tracking, and others. According to the Organization for Economic Co-operation and Development (OECD), in 2020, the growth of the blockchain market is likely to get slowed down, with a decrease in technology spending by 8%.
Various corporate organizations and governments are focusing on implementing innovative blockchain-based solutions to improve customer experience.
Such active initiatives are expected to drive the demand for blockchain AI-based solutions in the coming years.
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Growing Demand for NLP-powered Blockchain Solutions is a Prominent Trend
The increasing demand for the combination of blockchain and AI-based natural language processing (NLP) solutions among large enterprises is expected to be one of the key trends for the growth of this market. The intervention-free and fault-tolerant features combined with the non-modifiable, irreversible, and immutable characteristics of blockchain are vital for the security of the sensitive data generated by NLP solutions and algorithms. Blockchain solutions based on NLP help end-users to expand applications such as ERP systems, security management systems, and others.
NLP-blockchain solutions also cater to the healthcare sector to enhance patients' experience and care by using advanced, intelligent NLP platforms that generate insights from medical data. The combination of these two technologies can provide highly precise results. To cater to the increasing demand for such solutions, market players are focused on developing blockchain solutions integrated with NLP technology.
Rising Monetization of Customer Data by Using Blockchain to Aid Market Growth
Data monetization solutions enhance the capabilities of business applications and assist organizations in deriving insights from business data in the analytics phase. Organizations deploy these solutions to make precise business decisions. Customer data monetization solutions provide a platform for IT professionals to develop, design, execute, and deploy applications as per requirements. The advancements in artificial intelligence (AI), the Internet of Things (IoT), and big data technologies are likely to boost the adoption of data monetization solutions among enterprises. Key market players are focusing on launching new products to cater to the rising consumer demands.
Lack of Skilled Workforce among Enterprises to Impede Market Growth
This technology is a complicated system and is in nascent stages of development. As a result, businesses require an experienced workforce with certain skillsets for managing, developing, and implementing blockchain solutions powered by AI. Although this technology provides enormous benefits, the adoption of such platforms is still not up to the mark. Lack of awareness, insufficient investments, and inadequate funding might be the major hindering factors for the market over the next few years. Further, factors such as stringent government standards and uncertain regulations are also likely to hamper the growth of the market.
Growing Demand for Blockchain-AI Platforms across Organizations to Favor the Market
Based on the component, the blockchain AI market is segmented into platforms and services. Among these, the platforms segment is likely to hold the largest market share during the forecast period. The growing demand for blockchain artificial intelligence-based platforms across various organizations to ensure secure transaction models in their business units is expected to drive the segment’s growth.
The services segment is expected to register the highest growth rate during the forecasted period. The increasing demand for blockchain services such as systems integration & deployment, support & maintenance, and technology advisory & consulting from various industries is likely to boost the segment growth.
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Expanding Blockchain Applications across Industries to Boost Machine Learning Segment Growth
Based on technology, the market is divided into computer vision, machine learning (ML), natural language processing (NLP), and others. Among these, the machine learning (ML) segment is expected to exhibit the largest market share during the predicted period. This technology is supporting different industries, including education, healthcare, BFSI, automotive, and others, enhancing precision in analysis. In addition, the widening applicability of virtual assistants and chatbots is expected to fuel the demand for NLP technology in the market.
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Ease of Deployment to Boost Cloud Adoption
Based on deployment, the blockchain AI market is categorized into cloud-based and on-premise. Among these, the cloud-based segment is likely to command the largest market share in the foreseeable future. The segment’s growth is attributable to the rising adoption of cloud-based solutions and services among end-users. The cloud also provides pre-trained network solutions and services, which support building blockchain applications based on AI.
The on-premise segment is likely to show promising growth owing to the rising investments in AI-blockchain platforms by SMEs and governments.
Increasing Popularity of AI-Blockchain Solutions for Supply Chain Management to Drive the Market
Based on application, the market is segregated into smart contracts, logistics and supply chain management, payments and settlements, governance, risk, and compliance (GRC) management, and others. Among these, the logistics and supply chain management segment is anticipated to gain the largest share during the forecasted period. Key market players are focusing on the development of blockchain artificial intelligence-powered solutions for diverse and complex supply chain management applications.
The payments and settlements segment is likely to show significant growth owing to the increasing adoption of transparent transaction solutions in the various end-use industries. The growing implementation of blockchain AI solutions in various applications, such as smart contracts, governance, risk, and compliance management, and others, is further expected to boost the growth of the market.
Rising Adoption of Decentralized AI-based Applications in the BFSI Industry to Boost Market Growth
Based on industry, the blockchain AI market is segmented into BFSI, energy & utilities, government, healthcare, and life sciences, manufacturing, telecom, media & entertainment, retail & consumer goods, travel and transportation, and others.
The BFSI industry segment held the highest market share in 2019. Its dominance is attributable to the rising adoption of decentralized applications based on AI technology across fintech and financial institutions. Banking and financial organizations are focused on initiating various projects based on blockchain services.
The retail and consumer goods segment is expected to show considerable growth during the forecast period. In addition, other industries such as government, energy & utilities, life sciences, manufacturing, healthcare, and others are likely to grow at a notable rate.
North America Blockchain AI Market Size, 2019 (USD Million)
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The global market is divided into five regions, namely, North America, Europe, the Middle East & Africa, Asia Pacific, and South America.
North America is expected to lead the blockchain AI market share during the forecast period. The region’s leading position is primarily a result of the increasing investments and a growing number of blockchain projects across the US and Canada. In the US, there were around 2,000 blockchain projects during 2014-2017, according to the China Academy of Information and Communications Technology (CAICT). In addition, the governments in North America are focused on implementing blockchain artificial intelligence-based solutions in their public utilities, defense & military, banks, airports, and other domains.
Asia Pacific is likely to grow with the highest CAGR during the estimated period. According to CAICT, China has more than 33,000 active registered companies developing blockchain technology and services. Also, increasing investments by governments and major organizations for the development of projects based on blockchain are expected to drive regional market growth.
Europe held a significant position in this market in 2019. This is majorly due to the presence of a considerable amount of AI-driven blockchain solution providers in this region. Major market players are focused on investing in the development of technologies related to blockchain.
South America and the Middle East & Africa are estimated to develop at a significant rate. Increasing government initiatives for the development of blockchain services for various industries, improved funding, and the advent of technological advancements are anticipated to drive the growth of the market in these regions.
Leading Players to Focus on Developing Innovative Blockchain AI Products to Expand Portfolios and Increase Profitability
Market-leading players, such as Gainfy Foundation, AI-Blockchain, BurstIQ, LLC, Blackbox AI, and others, are focusing on offering advanced products owing to promising developments in innovative technologies. These players are focusing on adopting next-gen technologies, such as distributed ledger technology, neural networks, and deep learning, and catering to the different blockchain artificial intelligence-related applications. Also, the intense competition in this market is forcing blockchain service providers to focus on merger & acquisition strategies for strengthening their market position. Various prominent market players are offering advanced blockchain platforms and services for strengthening their market position.
August 2020 – BurstIQ, LLC launched its full developer kit, the BurstChain User Interface (UI) Software Developer Kit (SDK), for blockchain-based applications and services. This toolset allows organizations to quickly deploy and build solutions and services on the BurstIQ Platform.
An Infographic Representation of Blockchain AI (artificial intelligence) Market
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The blockchain AI market report offers qualitative and quantitative insights on the blockchain service industry and a detailed analysis of market size & growth rate for all possible segments in the market. Along with this, the report provides an elaborative study of market dynamics, emerging trends, opportunities, and competitive landscape. Key insights offered in the report are the adoption trends of blockchain solutions, recent industry developments such as partnerships, mergers & acquisitions, consolidated SWOT analysis of key players, business strategies of leading market players, macro and microeconomic indicators, and key industry trends.
Value (USD million)
Component; Technology; Deployment; Application; Industry; and Geography
Fortune Business Insights says that the market value stood at USD 184.6 million in 2019.
By 2027, the market size is expected to reach USD 973.6 million.
The market is expected to grow at a CAGR of 23.6% in the forecast period (2020-2027).
Within component, the platform segment is expected to lead the market during the forecast period.
Rising monetization of customer data by using blockchain is one of the key drivers for market growth.
Gainfy Foundation, AI-Blockchain, BurstIQ, and Blackbox AI are the top companies in the market.
The BFSI segment holds the major market share.
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