US gov blockchain spending accelerates

US federal government blockchain spending will grow from $10.7 million in 2017 to $123.5 million in 2022 – an overall compound annual growth rate of 63.1 per cent.

This is according to analysis from market intelligence firm IDC, which also predicted state and local government blockchain spending to grow from $4.4 million in 2017 to $48.2 million in 2022.

Its report explained that in general, IT services related to blockchain integration will grow faster than hardware and software solutions, as there is an evolving market for blockchain as middleware or microservice. Other applications include attaching the appropriate cryptostamp to transactions or assets, along with upgrading system access permissions.

"We believe asset management, identity management and smart contracts will be the leading blockchain solutions for government," said Shawn P. McCarthy, research director for IDC Government Insights. "Early spending will focus on supply chain and asset management solutions, while spending in later years will expand to include more identity management and complex financial transactions."

IDC noted that the forecast does not include cryptocurrency investments or associated solutions, as while these may become important to government offices in the future, authorities are currently spending very little money on cryptocurrencies at this time.

Ultimately, there will be even greater growth of blockchain at the local government level after 2022 because of the sheer number of local governments in the US, although that growth is slightly muted for the time being.

This is because smaller cities, towns, and rural counties are taking a ‘wait-and-see’ attitude when it comes to blockchain and will not be quick to adopt the new technologies.

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