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Homomorphic Encryption Market

Homomorphic Encryption Market

The market for Homomorphic Encryption was estimated at $180 million in 2024; it is anticipated to increase to $321 million by 2030, with projections indicating growth to around $519 million by 2035.

Report ID:DS1102020
Author:Ranjana Pant - Research Analyst
Published Date:January 2025
Datatree
Information Technology
Software & Platforms
Homomorphic Encryption
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Report Summary
Table of Contents
Methodology
Market Data

Global Homomorphic Encryption Market Outlook

Revenue, 2024

$180M

Forecast, 2034

$471M

CAGR, 2024 - 2034

10.1%
The Homomorphic Encryption industry revenue is expected to be around $198.4 million in 2025 and expected to showcase growth with 10.1% CAGR between 2025 and 2034. In a world where safeguarding data integrity and confidentiality is crucially important this advanced encryption technique offers a groundbreaking solution that allows computations to be carried out on encrypted data without the need for decryption in advance. This revolutionary capability has the potential to revolutionize sectors such, as healthcare, banking defense and cloud services where upholding data privacy and integrity is of utmost importance.

Encryptions core strength lies in its capacity to handle encrypted data seamlessly and securely while maintaining privacy and data integrity at a high level of security standards and flexibility that enables third party systems to work with data while safeguardinprivacy.

Homomorphic Encryption market outlook with forecast trends, drivers, opportunities, supply chain, and competition 2024-2034

Market Key Insights

  • The Homomorphic Encryption market is projected to grow from $180.2 million in 2024 to $472 million in 2034. This represents a CAGR of 10.1%, reflecting rising demand across Secure Data Computation in Cloud, Bringing Privacy to Machine Learning Models and Clinical Medical Research.
  • Microsoft Corporation together with IBM Corporation and Galois Inc lead the market as major competitors which determine its competitive dynamics.
  • U.S. and China are the top markets within the Homomorphic Encryption market and are expected to observe the growth CAGR of 7.4% to 10.6% between 2024 and 2030.
  • Emerging markets including UAE, Singapore and India are expected to observe highest growth with CAGR ranging between 9.7% to 12.6%.
  • Homomorphic Encryption market growth will receive a $38.2 million boost from Transition like Evolving Data Privacy Regulations until 2030.
  • The Homomorphic Encryption market is set to add $291 million between 2024 and 2034, with service providers targeting Energy & Health Care Industry Vertical projected to gain a larger market share.
  • With Rising cybersecurity threats, and Growth of cloud services, Homomorphic Encryption market to expand 162% between 2024 and 2034.
homomorphic encryption market size with pie charts of major and emerging country share, CAGR, trends for 2025 and 2032

Opportunities in the Homomorphic Encryption

There'sanother market waiting to be explored in the expanding autonomous vehicle sector.

Growth Opportunities in North America and Europe

North America Outlook

In North America's market for Homomorphic Encryption technology is thriving with a global market share due to the widespread use of cutting edge technologies and the strong presence of key industry players The market growth is driven by factors like rising cyber threats and privacy worries along with the increasing demand for secure storage of cloud data Competition in this field is intense with a focus, on constant innovation.

Europe Outlook

In Europe's expanding market for Homomorphic Encryption technology is thriving due to data protection laws such as GDPR and substantial investments in research and development . The competition in this market is defined by collaborations and partnerships that give companies a competitive edge over others. Moreover there are prospects, in the developing nations of Eastern Europe.

Market Dynamics and Supply Chain

01

Driver: Rising Cybersecurity Threats, and Technological Advancements in AI and ML

The rising occurrence and complexity of cyber assaults combined with the growing volume of data generated on a scale are also significant factors driving the Homomorphic Encryption market. This method of encryption offers a level of data protection making it challenging for unauthorized individuals to breach information security thus boosting its demand, in the industry. Technological progress in AI and ML calls for precautions to secure the data being utilized. Encryptions capability to maintain data encryption during processing renders it a viable option for safeguardinng valuable AI and ML data, against possible risks.
The widespread use of cloud services in industries like healthcare and finance requires encryption techniques to safeguard sensitive information of users. Homomorphic Encryption is also becoming increasingly popular for cloud computing since it permits computations, on encrypted data.
02

Restraint: High Computational Burden

One of the obstacles hindering the expansion of the homomorphic encryption market is the substantial amount of computational power and time needed for data processing tasks it entails. Homomorphic encryption involves carrying out operations on encrypted data without decryption. A process that can be significantly slower compared to operations on unencrypted data. This efficiency issue poses a challenge for real world applications due, to its computational demands and could deter businesses dealing with substantial amounts of data from embracing this technology.
03

Opportunity: Expansion in HealthTech and Accelerating Digital Transformation

The HealthTech industry offers a market potential for homomorphic encryption technologies as more people turn to telemedicine and remote patient monitoring in light of the recent health crisis pandemic situations are happening globally more so the need for enhanced security measures for sensitive healthcare information has skyrocketed in response to this trend homomorphic encryption provides a way for medical professionals to examine data while safeguard patient confidentiality serving as a practical option, within this field.
With the rapid digitization of industry ecosystems and services,There'san emerging opportunity for homomorphic encryption. Businesses across sectors are increasingly relying on cloud-based platforms, making data security crucial. The homomorphic encryption technique permits computation on encrypted data without any decryption, offering a robust shield against cyber theft. As businesses embrace digital transformation efforts, they could significantly benefit from adopting homomorphic encryption, thereby expanding the market for this technology.
04

Challenge: Lack of Familiarity and Complexity of Technology

Encryption technologys complexity poses a significant challenge to the markets expansion as it may hinder broader adoption due to the limited understanding of potential users, about this technology domain that demands expert knowledge and comprehension in encryption protocols.

Supply Chain Landscape

1
Research & Development

Microsoft

IBM

2
Raw Material Acquisition

Alibaba Group

Enveil

3
Product Production

Duality Technologies

SAP

4
Final Users & Applications

Healthcare Industry

Financial Services Industry

Government Agencies

*The illustration highlights the key stakeholders within the supply chain ecosystem.

Applications of Homomorphic Encryption in Secure Data Computation in Cloud, Bringing Privacy to Machine Learning Models & Clinical Medical Research

Secure Data Computation in Cloud

Homomorphic Encryption enables data processing in cloud environments by performing calculations directly onto encrypted data without the need for decryption first—a valuable feature for businesses using cloud services who prioritize data security and privacy concerns in today's digital landscape. Major industry players such as IBM leverage this technology to ensure data computation, within cloud infrastructures.

Clinical Medical Research

In the realm of research homomorphic encryption is utilized to conduct secure computations and analyses on encrypted patient records allowing researchers to analyze data and make predictions while safeguarding patient privacy and confidentiality a capability that top companies like Microsoft are utilizing to create secure platforms, for healthcare data analytics.`

Bringing Privacy to Machine Learning Models

Homomorphic encryption allows for training ML models using encrypted data to ensure privacy in making predictions and securely without compromising data securitys integrity! Companies, like Google are actively researching the use of encryption to offer AI solutions while maintaining user privacy.

Recent Developments

December 2024

Microsoft Corporation has unveiled a of Faster Homomorphic Encryption to bolster the security of cloud computing.

October 2024

IBM Corporation has released an upgraded edition of Homomorphic Encryption with the goal of providing high level online data protection suitable, for military use.

September 2024

CryptoExperts revealed their approach called Noiseless Homomorphic Encryption leading the way in safeguardin data privacy, in cloud computing settings.

Lately in the market scenario of Homomorphic Encryption technology we see a rise in its use across different sectors, like banking and healthcare as they embrace this high level encryption technique to protect their digital activities and confidential information securely during transactions and data handling processes.

Impact of Industry Transitions on the Homomorphic Encryption Market

As a core segment of the Software & Platforms industry, the Homomorphic Encryption market develops in line with broader industry shifts. Over recent years, transitions such as Evolving Data Privacy Regulations and Rise of Cloud Computing have redefined priorities across the Software & Platforms sector, influencing how the Homomorphic Encryption market evolves in terms of demand, applications and competitive dynamics. These transitions highlight the structural changes shaping long-term growth opportunities.
01

Evolving Data Privacy Regulations

The increasing awareness of data privacy on a scale has resulted in the implementation of strict laws and regulations that put pressure on companies to protect consumer data privacy effectively. The demand for encryption is on the rise as a result of these changes in regulations that require secure data handling and storage practices. The market for encryption is experiencing notable growth due, to the evolving regulatory environment emphasizing secure data processing and storage. This industry transition is expected to add $38.2 million in the industry revenue between 2024 and 2030.
02

Rise of Cloud Computing

The increasing use of cloud computing is transforming the landscape of the encryption industry as businesses increasingly transition to cloud services and require secure encrypted environments to handle data while it remains encrypted directly in the process state creating a surge in demand, for homomorphic encryption driven by the adoption of cloud based solutions and boosting market growth.

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