The tokenization market size has grown exponentially in recent years. It will grow from $3.38 billion in 2024 to $4.13 billion in 2025 at a compound annual growth rate (CAGR) of 22.1%. The growth in the historic period can be attributed to mobile payments growth, e-commerce expansion, data breaches, increasing digital transformation, fraud prevention, consumer privacy concerns.
The tokenization market size is expected to see exponential growth in the next few years. It will grow to $10.65 billion in 2029 at a compound annual growth rate (CAGR) of 26.8%. The growth in the forecast period can be attributed to cross-border payments, increasing mobile and contactless payments, healthcare data security, supply chain security, decentralized finance. Major trends in the forecast period include blockchain integration, tokenization of physical assets, non-fungible tokens(NFTs), AI and machine learning integration, tokenization as a service (TaaS).
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What are the key drivers behind the rapid expansion of the tokenization market?
The increasing use of digital and contactless payments is expected to propel the growth of the tokenization market during the forecast period. Tokenization protects sensitive data by replacing it with a non-significant value having the same format and length as the original one. The use of card tokenization for payment option is more secure than encryption since, with tokenization, there is no cryptographic key, only an intelligent map that cannot be cracked in the event of an attack. The increasing use of digital payments creates a high demand for payment security, thus driving the tokenization market. For instance, in September 2024, according to Clearly Payments Inc., a Canada-based payment processing company, the United Kingdom experienced a significant increase in transactions in 2023, reaching 18.3 billion, largely due to the widespread use of contactless cards and mobile payments. Meanwhile, Australia saw a steady growth in transactions from 2.5 billion to 5.5 billion, underscoring the country’s robust infrastructure for digital payments. Therefore, the growing digital transitions and payments are expected to drive the tokenization market.
What is the segmentation for the tokenization market?
The tokenization market covered in this report is segmented –
1) By Component: Solutions, Services
2) By Services: Professional Services, Managed Services
3) By Application Area: Payment Security, User Authentication, Compliance Management
4) By Vertical: Banking, Financial Services, And Insurance, Healthcare, IT And ITeS, Government, Retail And eCommerce, Energy And Utilities, Other Verticals
5) By Organization Size: Large Enterprises, SMEs
Subsegments:
1) By Solutions: Tokenization Software, Payment Tokenization Solutions, Data Tokenization Solutions, Cloud-based Tokenization Solutions
2) By Services: Consulting Services, Integration Services, Managed Services, Support And Maintenance Services
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Who are the most influential companies in the tokenization market?
Major companies operating in the tokenization market include American Express Company, Visa Inc., Mastercard Inc., Fiserv Inc., Entrust Corporation, Thales Defense & Security Inc., Sygnum Bank AG, Bluefin Payment Systems LLC, AsiaPay Limited, Futurex Industries Pvt Ltd., TokenEx Inc., Unicsoft Inc., TokenSoft Inc., MeaWallet AS, Inveniam Capital Partners Inc., Smart Token Labs, Apex India Pvt Ltd., Mt Pelerin AG, Blockchain App Factory, Token Minds Co, Boosty Labs, K20 Fund LLC, Securitize Inc., DigiShares ApS, Stably Inc., CipherCloud Inc., Hst Global Services Private Limited, Intelliblock Technologies Private Limited
What are the most influential trends expected to drive the tokenization market forward?
Major companies operating in the tokenization market are undergoing strategic collaborations to sustain in tokenization services market. Strategic collaborations drive innovation, expand capabilities, and create synergies in the tokenization market by leveraging diverse expertise, resources, and technologies. For instance, in August 2022, Skyflow, a US-based data privacy vault company, Deepens Collaboration with Visa Inc., a US-based Credit card service corporation, to Make Network Tokenization the Secure Payments Standard. The collaboration streamlines the implementation of network tokenization, ensuring simplicity and security, and aligns with Skyflow’s commitment to enhancing the overall security of the payment’s ecosystem. Utilizing Token ID, a Visa Solution, Skyflow facilitates network tokenization adoption for merchants, payment facilitators, and gateways, offering benefits such as fraud reduction, enhanced user experience, higher approval rates, and reduced transaction costs.
What are the major regional insights for the tokenization market, and which region holds the top position?
The countries covered in the tokenization market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.
What Does The Tokenization Market Report 2025 Offer?
The tokenization market research report from The Business Research Company offers global market size, growth rate, regional shares, competitor analysis, detailed segments, trends, and opportunities.
Tokenization is the process of converting sensitive data or information into a non-sensitive representation, known as a token. This token can be used in place of the original data for various purposes, such as processing transactions or accessing systems, without exposing the sensitive data itself.
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