Blockchain technology has taken off since last year, but not every organization will have the expertise and capacity to develop a blockchain-based platform. As a result, blockchain-as-a-service (BaaS) will become a popular business model over the next decade. BaaS companies can offer their own established cloud services and solutions for clients to build their very own blockchain applications. Tech giants such as IBM and Microsoft have already successfully penetrated the global BaaS market.
How blockchain helps us is old news – the technology is secure, fast and reliable. Big players now recognize the need for smaller businesses to get their hands on blockchain. In fact, small companies are the ones who need blockchain the most, since they are less equipped to overcome the obstacles in processing transactions and the costs involved.
The benefits of offer blockchain as a service is apparent. The use of BaaS in international business transactions could shrink the processing time and reduce costs by nearly 50%. Meanwhile, global trade is expected to rise by 15% as BaaS makes it easier to make cross-border payments. This is exactly what IBM and Microsoft have done so far: a collaborative solution designed to unite vegetable growers, processors, distributors, retailers and other stakeholders to securely and efficiently track the product at every step of the supply chain.
BaaS can also bring value to businesses in many stagnant sectors. The insurance, healthcare, and media and entertainment industries could always use blockchain to bring enhanced transparency and efficiency to consumers. In the future, smart contracts and automated payments could be the norm thanks to the BaaS model.
The entire BaaS market is set to grow bigger at a rapid pace. According to Zion Market Research, the global BaaS market was valued at $410 million USD last year. In 2024, this figure is expected to jump to $30.59 billion USD, representing an annual growth of nearly 85%.