Blockchain as a Service Market to Reach $7 Billion

A recent analysis by Bank of America’s Kash Rangan suggests that blockchain adoption will become a multi-billion dollar business.

Tech giant Microsoft already offers BaaS (Blockchain as a service) tools and services through Microsoft Azure which launched in 2015. Microsoft’s Azure includes a ‘sandbox’ where developers can test their apps before launch as well as various tools designed to streamline the development process.

Azure customers have access to the Ethereum blockchain after Microsoft partnered with ConsenSys, a decentralized collective of Ethereum coders launched by Ethereum co-founder Joseph Lubin. ConsenSys works to create blockchain businesses and DApps with the goal of developing the ‘Web 3.0’ infrastructure required to foster mass-adoption of blockchain and decentralization.

Amazon’s AWS also launched Ethereum and Hyperledger blockchain templates to aid developers in blockchain creation. Amazon’s BaaS launched in April 2018 and is aimed at providing a fast and easy way to create and deploy secure blockchain networks with open source frameworks.

With more and more industry titans rolling out their BaaS products, the potential market value grows increasingly more lucrative. BoA analyst Kash Rangan believes $7 billion to be the future value, although was hesitant to provide a set time as to when that value would be reached due to adoption limitations. However, Rangar did point out that the beneficiaries could merge cloud computing with blockchain solutions to improve supply chain operations, a major use case for blockchain technology.

“Amazon will benefit from incremental cloud services demand from Blockchain implementation, while improved supply chain tracking should make Amazon’s retail operations more efficient,” Rangan wrote to BoA clients on Tuesday.

Rangan’s analysis is based on the assumption that 2 percent of servers will be used to run blockchain, at $5,500 per server, per year. Given that Bank of America’s preliminary list of companies that could benefit from blockchain adoption includes Oracle , IBM , Salesforce.com , VMware , and real estate and mortgage players like Redfin , Zillow , LendingTree, this figure does not seem overly ambitious, and more applications are being discovered and tested every day.

“Many blockchain use cases have been identified, but full products/services have not yet been built out and are not used in production,” Rangan said.

The announcement follows a WEF report that indicates blockchain technology could generate an additional $1.1 trillion in world trade, while the IHS Market thinktank released a report suggesting that blockchain business could reach an overall value of $2 trillion by 2030. The latter report includes blockchain value generation in areas like banking, supply chain tracking and logistics, advertising and media, government auditing and bureaucracy, e power and energy industries, regulation, software development, telecommunications, and more.

Featured image from Shutterstock.

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