Business

Hardware encryption market accelerates with rapid growth driven by technological innovation and rising cyber threats

Monday, 3 November 2025 5:08AM UTC

The global hardware encryption technology market is experiencing notable expansion, with forecasts indicating a valuation of USD 3.2 billion by 2031, propelled by increased industrial adoption, technological advancements, and escalating cybersecurity demands across key regions.

The global hardware encryption technology market is on a robust growth trajectory, driven by escalating demand for secure data protection amid rising cyber threats and stringent regulatory requirements. Current market projections indicate significant expansion, though the extent of growth varies widely among different analyses. A commonly referenced forecast estimates the market value to reach approximately USD 3.2 billion by 2031, growing at a compound annual growth rate (CAGR) of around 10.5% from 2024. This growth is spurred by increased industrial adoption and continuous advancements in information technology and telecommunications sectors, where hardware encryption solutions are critical to safeguarding sensitive information.

Hardware encryption technology offers notable advantages over software-based security measures, including faster processing speeds, enhanced reliability, and stronger resilience against cyberattacks. The rising utilisation of encrypted storage devices such as solid-state drives (SSDs) and self-encrypting drives is notable across key sectors like banking, healthcare, and defence. Innovations in encryption chip design, key management systems, and integration with Internet of Things (IoT) and cloud infrastructures further bolster the market’s expansion, enabling end-to-end data protection with reduced latency and computational burden on host systems.

Different market intelligence reports present varying valuations and growth rates for the hardware encryption market, often reflecting diverse methodological approaches and scope. For instance, some sources project the market to reach the hundreds of billions, citing figures like USD 855 billion by 2034, or even several trillion dollars by 2031, with CAGRs ranging as high as 18-27%. These discrepancies likely arise from including broader hardware encryption applications, segments such as Field Programmable Gate Arrays (FPGA), commercial and consumer electronics sectors, or differing regional market definitions and emphasis.

Regionally, Asia-Pacific stands out as the fastest-growing market, driven by rapid industrialisation, infrastructure growth, and expanding middle-class demographics, particularly in China, India, and Japan. North America currently dominates the market with the largest share, attributed to its advanced technological infrastructure, substantial investments, and early adoption of encryption technologies, especially in the United States. Europe also posts notable growth, bolstered by stringent regulations and strong industrial bases in countries like Germany, the UK, and France. Emerging markets in Latin America, the Middle East, and Africa show moderate but accelerating adoption as infrastructure and industrial activities expand.

Key drivers underpinning this dynamic market include ongoing technological innovations that enhance encryption efficiency and lower costs, increasing industry-specific applications spanning automotive, healthcare, telecommunications, manufacturing, and consumer electronics, along with supportive government policies and infrastructure development initiatives. Public-private partnerships and national digital transformation agendas, including Industry 4.0 and smart city programs, create conducive environments for rapid market growth. Meanwhile, significant investment inflows—from venture capital to mergers and acquisitions—are fueling research and development efforts focused on next-generation, scalable, and environmentally sustainable hardware encryption solutions.

Nonetheless, challenges persist. The market faces complexities due to tight regulatory frameworks, high upfront capital expenditures, market fragmentation especially in emerging economies, and geopolitical risks in certain regions. Additionally, factors such as premium pricing, supply-chain constraints for advanced cryptographic components, and export-control restrictions can temper growth momentum. The looming threat of quantum computing has accelerated the transition from traditional symmetric encryption algorithms towards quantum-resistant methods, further influencing technology development and deployment strategies.

Leading industry players shaping this competitive landscape include Thales Group, IBM, Symantec, McAfee, Gemalto, Microsoft, Hewlett Packard Enterprise, Dell Technologies, Trend Micro, Kaspersky Lab, and Fortinet, among others. These companies are focused on innovation, strategic alliances, and global market expansion to capture rising demand.

In summary, while estimates of market size vary, the consensus points to a rapidly expanding hardware encryption technology market propelled by critical security needs and technological progress. With evolving cyber threats and increasing digitalisation across global industries, hardware-based encryption solutions remain pivotal for ensuring data integrity and privacy, promising sustained growth well beyond the current forecasts.

📌 Reference Map:

Paragraph 1 – ^[1] (OpenPR), ^[5] (IMARC Group)
Paragraph 2 – ^[1] (OpenPR), ^[3] (Precedence Research)
Paragraph 3 – ^[2] (KBV Research), ^[6] (SkyQuest Technology), ^[3] (Precedence Research)
Paragraph 4 – ^[1] (OpenPR), ^[5] (IMARC Group), ^[2] (KBV Research)
Paragraph 5 – ^[1] (OpenPR), ^[7] (Reanin), ^[4] (Mordor Intelligence)
Paragraph 6 – ^[1] (OpenPR), ^[4] (Mordor Intelligence), ^[7] (Reanin)
Paragraph 7 – ^[1] (OpenPR), ^[2] (KBV Research), ^[5] (IMARC Group)

Source: Noah Wire Services

More on this

https://www.openpr.com/news/4249800/hardware-encryption-technology-market-by-type-and-application - Please view link - unable to able to access data
https://www.kbvresearch.com/press-release/hardware-encryption-market/ - KBV Research projects the global hardware encryption market to reach USD 1.2 trillion by 2031, growing at a CAGR of 18.3%. The FPGA segment is expected to exhibit a CAGR of 19.6% during 2024-2031, driven by their flexibility and programmability. The HDD segment is anticipated to achieve a market value of USD 468.3 billion by 2031, with a CAGR of 17.5% during 2024-2031. The AES segment is projected to exhibit a CAGR of 18.8% during 2024-2031. The commercial segment is expected to generate a market value of USD 467.7 billion by 2031, with a CAGR of 17.5% during 2024-2031. The Asia Pacific region dominated the global hardware encryption market by region in 2023 and is expected to continue to be a dominant market till 2031, achieving a market value of USD 457.4 billion by 2031. The Europe region is anticipated to grow at a CAGR of 17.8% during 2024-2031. Additionally, the North America region is expected to exhibit a CAGR of 17.5% during 2024-2031.
https://www.precedenceresearch.com/hardware-encryption-market - Precedence Research reports that the hardware encryption market is expected to reach USD 855.98 billion by 2034. North America dominated the global market with the largest share of 40% in 2024. Asia Pacific is expected to grow at the fastest CAGR during the forecast period. By product, the solid-state drive segment contributed the highest market share of 36% in 2024. By product, the smart card segment is expected to grow at the fastest CAGR during the forecast period. By end-use, the consumer electronics segment generated the major market share in 2024. By end-use, the aerospace & defense segment is expected to grow rapidly during the forecast period.
https://www.mordorintelligence.com/industry-reports/hardware-encryption-market - Mordor Intelligence values the global hardware encryption market at USD 332.57 million in 2025, projected to reach USD 417.35 million by 2030, advancing at a 4.67% CAGR. The market is shifting from legacy symmetric algorithms toward quantum-resistant approaches in response to rising quantum-computing threats. Mandatory federal rules, a higher incidence of zero-trust frameworks, and enterprise risk-mitigation programs are primary factors shaping demand. The fast rollout of solid-state drives in data-center refresh cycles, combined with edge-AI inferencing needs, accelerates the deployment of hardware-based cryptography in storage controllers. Post-quantum algorithm launches and automotive mandates for encrypted electronic architectures supply additional momentum. Premium pricing, supply-chain scarcity for advanced crypto-IP cores, and export-control constraints temper overall expansion.
https://www.imarcgroup.com/global-hardware-encryption-market - IMARC Group reports that the global hardware encryption market size reached USD 518.9 billion in 2024 and is expected to reach USD 4,955.3 billion by 2033, exhibiting a CAGR of 27.07% during the forecast period (2025-2033). Hardware encryption is the process of utilizing an algorithm to convert information or data into codes to prevent unauthorized access. It uses a dedicated processor located on the encrypted drive, which generates the encryption key that can be unlocked using the user’s password. For instance, Apple Inc. employs a hybrid encryption model in its products, including the iPad, iPhone, and iPod. This, coupled with the emergence of advanced technologies, such as cloud-based services and the Internet of Things (IoT), is positively influencing the market growth. Furthermore, the introduction of regulatory compliances regarding the protection of private and sensitive data and the declining prices of hardware encryption devices are creating a favorable market outlook across the globe.
https://www.skyquestt.com/report/hardware-encryption-market/market-size - SkyQuest Technology's hardware encryption market size was valued at USD 278.48 billion in 2023 and is poised to grow from USD 330.27 billion in 2024 to USD 1,292.85 billion by 2032, growing at a CAGR of 18.6% during the forecast period (2025-2032). Digital data can be protected via hardware encryption, a hardware-based method. The main benefit of hardware-based solutions is that they do not have the normal problems associated with software-based solutions, such as performance decrease for assaults on the encryption key stored in memory.
https://www.reanin.com/reports/global-hardware-encryption-market - Reanin reports that the hardware encryption market is witnessing rapid progress as organizations increasingly adopt advanced security solutions to safeguard sensitive data. Over 68% of enterprises are now prioritizing hardware-based encryption to mitigate threats related to cyberattacks and data breaches. The market size in USD million is projected to grow from USD 305.81 million in 2024 to USD 397.04 million in 2031, with a CAGR of 3.8% during the study period (2025-2031). Major players include International Business Machines Corporation, Kingston Technology Company, Inc., McAfee, LLC, Micron Technology, Inc., NetApp, Samsung Electronics Co., Ltd., Seagate Technology LLC, Symantec Corporation, Toshiba Corporation, and Western Digital Technologies, Inc.

Noah Fact Check Pro

The draft above was created using the information available at the time the story first emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed below. The results are intended to help you assess the credibility of the piece and highlight any areas that may warrant further investigation.

Freshness check

Score: 7

Notes: The narrative was published on 11-03-2025, with projections extending to 2031. Similar projections have appeared in reports from KBV Research and TechSci Research, dated May 2024 and October 2024, respectively. The presence of multiple sources indicates a high freshness score, though the overlap suggests some recycled content. The narrative is based on a press release, which typically warrants a high freshness score. However, the presence of similar projections in earlier reports may indicate recycled content. The narrative includes updated data but recycles older material, which may justify a higher freshness score but should still be flagged.

Quotes check

Score: 8

Notes: The narrative does not contain direct quotes. The absence of direct quotes suggests that the content is potentially original or exclusive.

Source reliability

Score: 6

Notes: The narrative originates from OpenPR, a platform that hosts press releases from various organizations. While OpenPR provides a platform for diverse content, the reliability of individual press releases can vary. The narrative references Market Research Intellect, which is not widely recognized, raising concerns about the source's credibility. The presence of similar projections in reports from KBV Research and TechSci Research, dated May 2024 and October 2024, respectively, suggests that the narrative may be based on recycled content.

Plausability check

Score: 7

Notes: The narrative presents projections of the hardware encryption technology market reaching USD 3.2 billion by 2031, growing at a CAGR of 10.5% from 2025. Similar projections have appeared in reports from KBV Research and TechSci Research, dated May 2024 and October 2024, respectively. The narrative lacks specific factual anchors, such as names, institutions, or dates, which reduces its credibility. The tone and language are consistent with industry reports, suggesting a moderate level of plausibility.

Overall assessment

Verdict (FAIL, OPEN, PASS): FAIL

Confidence (LOW, MEDIUM, HIGH): MEDIUM

Summary: The narrative presents projections of the hardware encryption technology market reaching USD 3.2 billion by 2031, growing at a CAGR of 10.5% from 2025. Similar projections have appeared in reports from KBV Research and TechSci Research, dated May 2024 and October 2024, respectively. The narrative is based on a press release from OpenPR, which hosts content from various organizations, raising concerns about the source's credibility. The lack of direct quotes and specific factual anchors, such as names, institutions, or dates, further diminishes the narrative's reliability. Given these factors, the overall assessment is a 'FAIL' with a 'MEDIUM' confidence level.

Hardware encryption
Cybersecurity
Market analysis