Decentralized Identity Market, Opportunity, Growth Drivers, Industry Trend Analysis and Forecast, 2024-2032

Decentralized Identity Market, Opportunity, Growth Drivers, Industry Trend Analysis and Forecast, 2024-2032

Decentralized identity market size is expected to register over 70% CAGR between 2024 and 2032, driven by the rising demand for secure, user-controlled digital identity solutions. Conventional identity systems, often reliant on centralized repositories, are susceptible to breaches and misuse. In contrast, decentralized identity technology empowers individuals to retain control over their personal information, significantly mitigating the risks of identity theft and bolstering privacy.

In response to growing concerns, governments and organizations worldwide are enacting stringent regulations aimed at safeguarding personal data and promoting transparency in data handling. Decentralized identity systems have emerged as a formidable solution, adept at fulfilling these regulatory mandates through secure, verifiable, and privacy-centric identity management. For example, in May 2024, MicroStrategy Orange unveiled decentralized identities, emphasizing their trustless, tamper-proof, and enduring nature, all made possible by harnessing the Bitcoin blockchain. As enterprises strive to keep pace with evolving regulatory standards and bolster their digital security, the decentralized identity market witnesses a corresponding surge.

The overall industry is segmented into identity type, enterprise size, industry vertical, and region.

Based on identity type, the decentralized identity market size from the non-biometrics segment is projected to observe substantial growth through 2032. This surge is attributed to non-biometric solutions, such as cryptographic keys, digital signatures, and multi-factor authentication, which not only complement traditional biometric methods but also introduce added layers of security and flexibility. These non-biometric methods, when integrated into decentralized identity systems, not only bolster security but also address the privacy concerns often linked with biometric data.

Decentralized identity market from the small and medium-sized enterprises (SMEs) segment is anticipated to generate high revenue between 2024- 2032 due to the need for cost-effective, scalable, and secure identity management solutions. Decentralized identity systems offer SMEs a way to enhance security and streamline identity verification processes without the high costs associated with traditional centralized systems.

Europe decentralized identity industry is predicted to grow at a strong rate through 2032, largely credited to the stringent regulatory landscape and unwavering commitment to digital innovation. The General Data Protection Regulation (GDPR) stands out as a pivotal force, shaping the trajectory of decentralized identity solutions in Europe by underscoring the importance of user control over personal data and advocating for rigorous privacy protections.