Hardware Security Modules (HSM) market is anticipated to grow at a CAGR of 11.1% during the forecast period (2024-2031). The market growth is driven by the growth of industry digitalization, specifically in cloud-based network deployments, as it increases the demand for hardware security modules to safeguard encryption keys and algorithms for subscription authentication. The growing adoption of 5G, and IoT with the improving private networks and critical communications services is additionally contributing to the market growth. The authentication security module enables communications service providers to store crypto keys and algorithms in an HSM augmenting security for markets and use cases that have more strict security requirements. The increasing focus on authentication security modules is significantly propelling the market during the forecast period.
The global hardware security modules market is segmented by type (LAN Based, PCIE and USB Based), by application (payment processing, code and document signing, Secure Sockets Layer (SSL), Transport Layer Security (TLS), authentication, database encryption and credential management), and by end users (BFSI, IT & telecommunications, consumer goods & retail, aerospace & defence, public sector/government, energy and power and others), and by geography (into North America, Europe, Asia-Pacific, and the Rest of the World).
Market Dynamics
- The payment processing segment is expected to hold a considerable share of the global hardware security modules market, owing to the growing influence of advanced solutions for enabling encryption, key management, authentication, and other HSM services in the cloud.
- Asia-Pacific regions is anticipated to grow at a considerable CAGR over the forecast period attributed to rise in the BFSI, IT and Telecommunications, and medical and life sciences, and automotive industry. Furthermore, the development of 5G technology is estimated to boost regional market.
The major companies serving the HSM market include Atos SE, IBM Corp., Infineon Technologies AG., Thales, Utimaco Management GmbH, Yubico, and others. The market players are considerably contributing to the market growth by the adoption of various strategies including mergers and acquisitions, partnerships, collaborations, funding, and new product launches.
Recent Developments
- In February 2025, Thales Trusted Cyber Technologies (TCT) released version 2.18.0 of TCT, and two firmware patches for the Luna T-Series HSM. The Luna T-Series HSM 7.11.2 firmware patch is for HSMs running current FIPS 140-2 validated firmware version 7.11.1 or older. It is FIPS 140-2 validated under Certificate #3898. The Luna T-Series HSM 7.13.3 firmware patch is for HSMs running firmware version 7.12.0 or newer. It is undergoing FIPS 140-3 evaluation.
- In October 2024, JISA Softech, officially launched Payment Hardware Security Module (HSM), CryptoBind Payment HSM. It will revolutionize the way financial institutions manage cryptographic operations and safeguard sensitive payment information and transactions. The CryptoBind Payment HSM offers a unique partitioning capability, allowing it to be divided into multiple virtual HSMs. Each partition operates independently, providing financial institutions with the scalability to encrypt more data and secure a broader range of financial transactions without deploying multiple HSMs. It thus simplifies cryptographic operations and enhances the efficiency of security applications.
- In February 2024, Securosys SA, unveiled its the Primus X Cyber Vault. The HSM offers a performance of over 50,000 transactions per second (TPS). It is additionally scalable in a clustered configuration with one million TPS and more. It supports Post-Quantum-Computer Cryptography (PQC) and enables hybrid signatures – while maintaining consistent throughput, notwithstanding.
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