Blockchain AI Market Size, Share & COVID-19 Impact Analysis, By Component (Platform and Services), By Technology (Computer Vision, Machine Learning (ML), Natural Language Processing (NLP), and Others), By Deployment (Cloud-based, and On-premise), By Application (Smart Contracts, Logistics, and Supply Chain Management, Payments and Settlements, Governance, and Others), By Industry , and Regional Forecast, 2020-2027

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%. North America dominated the blockchain AI market with a market share of 50.27% in 2019.

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.

COVID-19 Impact

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.

• For instance, in November 2020, Verida Credit collaborated with CareProtocol, an AI health start-up, to launch its decentralized OpenHealth data ecosystem, the IKIGAI Network, which is powered by AI and blockchain technology. This smarter and highly efficient health information management system allows healthcare experts to synchronize health data with a network of individuals, physicians, institutions, and entrepreneurs amid the COVID-19 crisis.  

Such active initiatives are expected to drive the demand for blockchain AI-based solutions in the coming years.

LATEST TRENDS

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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.

• For example, in September 2019, Zensar Technologies Limited launched its blockchain-based contract management solutions – DICES (Distributed Intelligent Contract Enforcement System) and ZenConfluence – for various enterprises. Both the solutions use a combination of NLP and a transpiler to extract important clauses in smart contracts. The aim is to help end-users enforce and track the contractual goals without manual intervention, quickly and efficiently.

DRIVING FACTORS

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.

• For instance, in February 2019, Continental AG and Hewlett Packard Enterprise (HPE) launched a new blockchain-based platform called the Data Monetization Platform. It is designed to be used for sharing vehicle data to enable new digital solutions that improve drivers’ convenience and safety. It also helps car manufacturers to monetize their data and provides data security and transparency to overcome issues related to the sharing of vehicle data.

RESTRAINING FACTORS

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.

SEGMENTATION

By Component Analysis

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.

By Technology Analysis

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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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By Deployment Analysis

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.

By Application Analysis

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.

By Industry Analysis

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.

• For instance, in June 2020, Green Pratt & Whitney Network Technology Co., Ltd., together with WeBank, signed an online strategic cooperation agreement to launch a blockchain-based green travel project, called the Green Travel Pratt & Whitney Platform, across China. The aim is to promote the reduction of greenhouse gas emissions by limiting vehicle usage.

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.

REGIONAL INSIGHTS

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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.

• For instance, in May 2020, Tencent Holdings Ltd., the China-based parent company of WeChat, invested around USD 70 billion into AI, Blockchain, Cybersecurity, and others in pursuit of new infrastructures.

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.

• For instance, in January 2018, prominent players based in the U.K. invested around USD 19 million for the development of innovative blockchain solutions and services integrated with AI.

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.

KEY INDUSTRY PLAYERS

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.

LIST OF KEY COMPANIES PROFILED:

• BurstIQ, LLC (Colorado, United States)


• Figure Technologies (California, United States)


• Cyware Labs Inc. (New York, United States)


• Core Scientific (Washington, United States)


• NetObjex, Inc. (California, United States)


• Fetch.ai (Cambridge, England)


• Ai-Blockchain (New Jersey, United States)


• Alpha Networks (Taiwan)


• Bext Holdings Inc. (Bext360) (Colorado, United States)


• SocialTrendly, Inc. (BLACKBIRD.AI) (New York, United States)


• Chainhaus (New York, United States)


• Gainfy (New York, United States)


• Hannah Systems (California, United States)


• Numerai (California, United States)


• NeuroChain (Paris, France)

KEY INDUSTRY DEVELOPMENTS:

• In July 2021, Figure Technologies Inc,  raised USD 200 million in series D funding at USD 3.2 billion valuation. The investment will enable to leverage blockchain to reinvent the financial services industry.


• In May 2021, BurstIQ collaborated with The National Center for Advancing Transactional Sciences (NCATS) to protect intellectual property associated with NCATS using blockchain. This collaboration aims to develop artificial intelligence and machine learning models for data access within a collaborative research environment.


• In September 2020, BurstIQ partnered with Tech Mahindra to provide identity management platform identity data management (IDM) and provider data management (PDM). Both identity management platform will leverage BusrtIQ’s blockchain based secure data exchange network for management, exchange and ownership of sensitive data including professional, health, and identity information.

REPORT COVERAGE

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.

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