Decentralized Identity Market (By Identity Type: Biometrics, Non-biometrics; By End-user: Individual, Enterprises; By Enterprise Size; By Vertical) - Global Industry Analysis, Size, Share, Growth, Trends, Revenue, Regional Outlook and Forecast 2024-2033

The global decentralized identity market size was estimated at around USD 1.15 billion in 2023 and it is projected to hit around USD 718.17 billion by 2033, growing at a CAGR of 90.35% from 2024 to 2033. 

Key Pointers

• North America dominated the market with the largest market share of 33% in 2023.
• Asia Pacific is anticipated to grow at the fastest CAGR of 91.97% from 2024 to 2033.
• By Identity Type, the biometric segment held the largest revenue share of 66% in 2023.
• By End-user, the individual segment is expected to register the fastest CAGR of 91.63% over the forecast period.
• By Enterprise Size, the large enterprises segment generated the maximum market share of 69% in 2023.
• By Enterprise Size, the small & medium enterprises (SMEs) segment is anticipated to register the fastest CAGR of 90.85% from 2024 to 2033.
• By Vertical, the BFSI segment contributed the largest market share of 21% in 2023. 

Decentralized Identity Market Growth Factors

The growth of the decentralized identity market is propelled by the increasing concern regarding data privacy and security breaches in centralized identity systems are driving demand for alternative solutions that offer greater control and ownership over personal data. Secondly, the widespread adoption of blockchain technology, with its inherent characteristics of immutability and transparency, has positioned decentralized identity as a viable solution for secure and tamper-resistant identity management. Additionally, the growing digitization of services across various industries is fueling the need for efficient and trustworthy identity verification mechanisms. Moreover, regulatory initiatives and standards development efforts aimed at fostering interoperability and compliance are contributing to the market's growth by instilling confidence and trust among stakeholders. Lastly, the rising awareness and acceptance of self-sovereign identity principles among individuals and organizations are further accelerating the adoption of decentralized identity solutions, driving market expansion and innovation.

Report Scope of the Decentralized Identity Market

Decentralized Identity Market Trends:

• Interoperability Initiatives: Collaborative efforts among industry stakeholders to establish interoperable standards and protocols are gaining traction, enabling seamless integration and interoperability across diverse decentralized identity ecosystems.
• Emergence of Identity Wallets: The rise of identity wallet solutions is transforming how individuals manage and control their digital identities, providing a secure and user-centric approach to storing and selectively sharing identity attributes.
• Integration with Digital Services: Increasing integration of decentralized identity solutions with various digital services such as financial transactions, healthcare records management, and government services is driving adoption and expanding the use cases for decentralized identity.
• Regulatory Developments: Regulatory frameworks and standards development initiatives focused on data privacy, security, and identity verification are influencing the direction of the decentralized identity market, shaping compliance requirements and market dynamics.
• Focus on Usability and User Experience: Efforts to enhance the usability and user experience of decentralized identity solutions are gaining prominence, with a focus on simplifying user interactions, improving accessibility, and ensuring seamless integration with existing workflows and applications.
• Rise of Decentralized Identifier (DID) Networks: The proliferation of decentralized identifier (DID) networks, powered by blockchain and other distributed ledger technologies, is providing a foundation for building scalable and secure decentralized identity infrastructures, driving innovation and adoption.

Identity Type Insights

In terms of identity type, the biometric segment dominated the market in 2023 with a revenue share of more than 66%. Biometric identifiers, such as fingerprints, facial recognition, iris scans, and voice recognition, provide a high level of precision and security in authenticating an individual's identity. This type of identity verification offers a strong level of verification and is difficult to forge or replicate, making it highly reliable for forming trust in digital interactions. Biometric identity also offers convenience and ease of use for users. With biometric authentication, individuals can confirm their identity quickly and seamlessly by solely using their distinctive biological traits. This excludes the necessity for passwords or other traditional forms of authentication, which can be easily forgotten, stolen, or compromised.

The non-biometrics segment is anticipated to grow substantially over the forecast period. The growing demand for non-biometric identity among consumers owing to easy portability and convenience is expected to drive the segment's growth. Moreover, non-biometric authentication is typically used as a backup for biometric password-less security. Such factors are anticipated to contribute to the segment growth over the forecast period.

End-user Insights

In terms of end-user, the enterprises segment dominated the market in 2023 with a revenue share of more than 67%. The growing concern for reducing business risk is a significant factor driving the segment growth. Moreover, a decentralized identity framework enables enterprises to control users’ identities independently of the identity issuer. Furthermore, a decentralized identity eliminates the initial need for organizations to gather and store personal data.

The individual segment is expected to register the fastest CAGR of 91.64% over the forecast period. The growth of the individual segment can be attributed to the increasing adoption of decentralized identity solutions by individuals for creating and maintaining their identities. Furthermore, the decentralized identity solutions help individuals verify and authenticate themselves in various identification processes for different use cases such as loan sanctioning, bank account opening, and other KYC processes, among others. Thus, such wide use cases of the decentralized identity to the individual users are further expected to drive the growth of the segment over the forecast period.

Enterprise Size Insights

In terms of enterprise size, the large enterprises segment dominated the market in 2023 with a revenue share of over 69%. The demand for decentralized identity is rising among large enterprises as these enterprises are trying aggressively to avoid identity risk. For instance, in August 2023, Litentry, a multi-chain identity protocol, announced a partnership with Node Real, a blockchain infrastructure solution provider. Through the partnership, Litentry can incorporate NodeReal's MegaNode, which offers powerful real-time and historical data indexing on the Ethereum and Binance Chain networks.

The small & medium enterprises (SMEs) segment is anticipated to register the fastest CAGR of 90.85% over the forecast period. Small enterprises typically try to digitalize their services and enhance the customer experience. Furthermore, the application of blockchain technology-based identity management can be widely adopted as a means of guaranteeing the protection of private information and improving accountability and trust between parties. In addition, SMEs also benefit from increased product and service efficiency and quality, improved supply chain management, and blockchain-driven business model innovation.

Vertical Insights

In terms of vertical, the BFSI segment dominated the market in 2023 with a revenue share of over 21%. Banks are required to conduct KYC checks to confirm customers' identity and ensure they are not involved in any illegal activity, such as bribery or money laundering. In addition, the U.S. spends USD 25 billion on Anti Money Laundering (AML) compliances. Moreover, according to Forbes, in April 2019, major banks spent up to USD 500 million annually on cybersecurity.

The telecom & IT segment is anticipated to grow at the fastest CAGR of 92.17% over the forecast period. With the increasing digitization of communication and the growing demand for secure and seamless identity verification, the telecom & IT segment is actively exploring decentralized identity solutions to enhance user experiences and ensure robust security. Telecom and IT companies often handle a vast amount of sensitive customer data, including personal information and authentication credentials. By adopting decentralized identity solutions, they can provide their customers with greater control and ownership over their identity information while also enhancing data privacy and protection.

Regional Insights

In terms of region, North America dominated the market in 2023 with a revenue share of more than 33%. The North America region has a varied range of industries and sectors that can benefit from decentralized identity solutions. These comprise financial services, healthcare, government, and e-commerce, among others. The need for secure and effectual identity authentication, data sharing, and user verification in these sectors has driven the adoption of decentralized identity technologies. In addition, it has a huge and tech-savvy population that is progressively more aware of the significance of data privacy and digital security, which is also accentuating the market growth in the region

Asia Pacific is anticipated to grow at the fastest CAGR of 91.97% over the forecast period. The regional market's growth can be attributed to the growing awareness of cybersecurity in nations such as India, China, and Japan. Aggressive efforts are being pursued by various organizations across the Asia Pacific to safeguard consumer identity, which is also expected to contribute to the regional market’s growth. For instance, in April 2021, Affinidi, a Tamsek identity startup, and The Commons Project Foundation, a global nonprofit tech firm, formed a collaboration. The main aim of this collaboration was to integrate digital credentials for secure international travel.

Decentralized Identity Market Key Companies

• Microsoft Corporation
• Accenture plc
• Wipro Limited
• SecureKey Technologies Inc.
• Persistent Systems Limited
• Avast Software s.r.o.
• Civic Technologies, Inc.
• R3
• Validated ID, SL
• Dragonchain
• Nuggets
• 1Kosmos Inc.

Decentralized Identity Market Segmentations:

By Identity Type 

• Biometrics
• Non-biometrics

By End-user 

• Individual
• Enterprises

By Enterprise Size 

• Large Enterprises
• Small & Medium Enterprises

By Vertical 

• BFSI
• Government
• Healthcare & Life Sciences
• Telecom & IT
• Retail & E-commerce
• Transport & Logistics
• Real Estate
• Media & Entertainment
• Travel & Hospitality
• Others

By Region

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