Passwordless Authentication Adoption Trends in 2025

User-created passwords date back to the 1960s at MIT. As the industry grew and computers became common, passwords were the main way to protect accounts. The internet’s rapid growth in the 1990s led to a rise in cybercrimes. Hacking, phishing, and credential attacks became more common.

The new wave of cybercrime made conventional passwords look like ancient technology. Attackers got so good they could hack a weak password in the space of a few seconds. 

In 1999, the call for better security grew. This was sparked by the creation of the FIDO Alliance (Fast Identity Online). Since then, cybersecurity has changed. Now, it uses security tokens, biometrics, and passkeys. Recently, AI has been added to help stop malicious actors. 

Passwordless authentication grew quickly in recent years. Businesses shifted to cloud systems, and people began spending more time online. Tech teams around the world find that passwordless methods provide better security for organizations. They also create a smoother experience for users.

Passwordless features are now standard on smartphones. Regulators want companies to protect customer data. Cybercriminals are constantly finding new ways to break into systems. So, it looks like passwordless authentication will make user-generated passwords as outdated as punched cards.

Let’s see what’s in store for 2025, with an expanded look at this year’s passwordless authentication adoption trends.

Passwordless Authentication Statistics: Editor’s Picks

• The global passwordless authentication market is expected to reach almost $22 billion this year, and approach $90 billion in the next decade.
• A survey of CISOs revealed that 81% of security incidents are caused by breached credentials. 
• 70% of organizations are planning to adopt passwordless authentication or are already in the process of implementing it according to Portnox.
• Verizon’s Data Breach Investigations Report found that 68% of data breaches involved human error.
• Password reset requests are responsible for 30-50% of IT support tickets at large enterprises.
• 94% of IT leaders have major concerns about user-generated passwords. And two-thirds are looking for solutions to combat the high cost of help desk password issues.

Adoption Trends in 2025

There are several key drivers behind the movement toward passwordless authentication.

Biometric authentication methods grew in 2025. Fingerprint and facial recognition technology saw more use. Smartphones now have built-in biometric features. This is helping both businesses and consumers use biometric authentication.

Enterprises are using passwordless strategies like passkeys as part of Zero Trust frameworks. Many organizations see fewer IT support tickets and save money with passwordless authentication.

Passkeys are trending with consumers who want to make sign-on easier and more secure. Apple launched passkeys in 2022. Many companies have started offering passkeys to their users. This includes Google, Amazon, Microsoft, PayPal, Coinbase, and Uber.

Enterprise Adoption

Businesses see that passwordless authentication improves security. It helps both IT teams and non-IT staff work more efficiently. 

• 50% of US enterprises have adopted some form of passwordless authentication.
• A 2021 study by the Ponemon Institute calculated that businesses adopting passwordless authentication saved almost $2 million over those using standard passwords and multi-factor authentication (MFA).
• Microsoft reduced authentication costs by 87% after moving to passwordless authentication methods.
• FIDO-based mobile and fingerprint authentications are the fastest methods for employee logins, with each taking only about 7 seconds. Using traditional passwords takes double the time.
• After Accenture introduced passwordless authentication, phishing attacks dropped by 60%.
• 100% of businesses that adopted FIDO standards have seen significant improvements in security and user experiences, and a reduction in help desk and support issues.

Top Industries Using Passwordless

Finance, healthcare, and retail are at the forefront of passwordless security. They have specific security needs, must follow regulations, and handle many transactions. These industries have large client and customer databases. These databases are full of sensitive information, making them prime targets for cybercriminals.

• 68% of healthcare organizations plan to implement passwordless security by 2025.
• Finance held the largest market share for passwordless authentication in 2023.
• A survey of online retailers from 2020 revealed that more than 80% of online shoppers prefer biometric authentication to traditional passwords.

Consumer Adoption

Passwordless options are quickly becoming popular. Companies want to offer a smoother user experience for easy transactions. Users also want to keep their accounts safe. Studies show that online retailers gain more consumer trust and boost sales by using passwordless authentication. 

• Consumer awareness of passkeys has jumped from 39% to 57% since 2022.
• Passkeys are enabled on over 90% of iOS and Android devices.
• 33% of consumers abandoned shopping carts and login attempts due to forgotten passwords.
• 78% of users prefer online banking, but last year phishing attacks against banks increased over 300%, underlining the need for more secure login methods.
• In 2023 the FIDO alliance counted over 7 billion online accounts that used passwordless sign-ins.
• Some passwordless security solutions can speed consumer login times to under 2 seconds compared to more than 10 seconds with traditional passwords.

Popular Methods of Passwordless Authentication

There are many options for IT teams that want to implement passwordless authentication in their organizations. Biometric authenticators, one-time passwords (OTP) via SMS, and hardware tokens like YubiKeys offer strong security. They also make logging in easier for users.

Biometric Authentication

Unique identifiers like fingerprints, faces, irises, and voice patterns can be used in biometric authentication. Biometric indicators are quick and very secure. However, leaks can raise privacy concerns.

• 176 million Americans use facial recognition technology, with biometrics enabled on 81% of smartphones. 
• The top three areas Americans want to see facial recognition technology used for security are airports, banks, and medical offices.
• Users’ top concern when it comes to adopting biometrics is the possibility of mass surveillance.

One-Time Passwords (OTP)

OTP methods use temporary codes for one-time logins. These codes come via text, email, or authenticator apps. Recent advances in malicious technology have made some OTP strategies vulnerable. Phishing and man-in-the-middle attacks can exploit these weaknesses.

• One-time passwords remain a top method for passwordless authentication, with 38% of organizations reporting they rely on OTP.
• A Cornell study found that MFA approaches deploying OTPs reduce the risk of account compromise by 99% as compared to traditional password methods.
• 89% of banking organizations expressed some level of concern about delivering OTP through SMS.
• A 2023 survey showed that 60% of consumers opted in to OTP MFA for online banking accounts.

Hardware Tokens

Hardware tokens are physical devices that offer strong security. However, users need to have them on hand. YubiKeys are devices that use FIDO2 authentication. They connect via USB or a contactless interface. Wireless fobs can be deployed in Bluetooth-enabled devices. Loss or theft is the biggest issue with hardware tokens.

• The market for hardware tokens is projected to double by 2033, reaching a value of $1.3 billion.
• 19% of government agencies utilize hardware tokens for security.
• Yubico reported that customers implementing YubiKeys for security saw a near 100% drop in phishing and credential attacks.
• YubiKey customers also saw a 75% reduction in password-related help desk tickets.

The Future of Passwordless Authentication

New passwordless technologies are showing clear benefits. They are more secure, cost-effective, and user-friendly than traditional passwords. Many users and organizations are still new to passwordless authentication. So, the market will grow. This is true, especially as cybercriminals keep succeeding with phishing and credential attacks. More users see the benefits of passwordless authentication. So, a passwordless future for everyone seems more likely each day.

AI Integration

AI and machine learning can analyze many indicators. These include device recognition and biometric recognition. They are also trained to find anomalies in real time during user sessions.

Continuous authentication is a new technology. AI systems watch user behaviors, such as typing patterns and mouse movements. They compare these behaviors to the current session. This helps to check if someone unauthorized has gained control of the system. If we spot an unauthorized user, we can act right away to prevent any issues.

AI can also be used to enhance FIDO2 security keys and detect suspicious logins as they happen.

Legislative Support

Laws to support passwordless authentication may soon be common. This shift happens as governments recognize the flaws in traditional passwords. Regulators and compliance officers in the U.S., Europe, and Asia want organizations to protect customer databases. They recommend using phishing-resistant security measures like biometrics, passkeys, and Zero Trust frameworks. 

Sectors like healthcare and finance store very sensitive data. They face strict scrutiny from regulators who want better authentication methods.

Market Growth

The global demand for passwordless authentication is projected to reach an all-time high in 2025, in excess of $20 billion. The U.S. market alone is expected to be worth even more than that within the next decade. Estimates put the value at over $23 billion by 2034. The demand for better security and easier user experiences is rising. Because of this, the global market for passwordless authentication should keep growing for several more years.

Mobile devices designed for passwordless authentication help more users make the switch. They will keep driving market growth.

Cyberattacks keep rising. New malicious tech helps hackers exploit users more easily. This will lead to more rules requiring passwordless technology to stop breaches.

Companies are moving from old systems to cloud platforms. They need secure passwordless systems. These systems are essential for all organizations.

See how JumpCloud can help your organization implement or enhance its passwordless authentication capabilities. JumpCloud Go™ offers a smooth sign-on experience for your team. They get instant passwordless access to all resources managed by JumpCloud.

Sign up for a free trial to experience how JumpCloud passwordless security minimizes user fatigue, shrinks attack surfaces, and reduces login support requests.