The Future of IP Addressing: Analysis of IPv4 Exhaustion and the Path Toward IPv6
According to APNIC, the world of Internet Protocol (IP) addressing has undergone significant changes in recent years, shedding light on the evolving challenges and strategies for managing the growth of devices connected to the Internet. With the nearing exhaustion of IPv4 addresses and the slow but critical adoption of IPv6, the telecom and technology industries face a pivotal moment in shaping the Internet’s future.
IPv4 Depletion: Where Are We Now?
The depletion of IPv4, the 32-bit protocol introduced in the 1980s with a total capacity of ~4.3 billion unique addresses, has been a well-documented issue. As of the end of 2025, the available global pool of IPv4 addresses has shrunk to just 3.9 million, with regions such as APNIC and AFRINIC holding the majority of these remaining allocations (3.1 million and 773,000 addresses, respectively). The total allocated IPv4 pool contracted slightly in 2025 by 237,000 addresses, confirming that meaningful depletion had long been achieved.
A critical lifeline keeping IPv4 operational has been the widespread use of Network Address Translation (NAT), which allows multiple devices to share a single public IP address. However, even NAT has limits, given the network’s growth trajectory. Globally, the number of connected devices now exceeds 30 billion, while the IPv4 protocol can only accommodate approximately 3 billion routed devices, creating significant inefficiencies and a supply-demand imbalance in the IP address market.
Meanwhile, IPv4 addresses remain in circulation due to secondary markets. In 2025 alone, over 33 million IPv4 addresses were transferred globally. Major market players, such as Amazon, leveraged this opportunity by acquiring millions of addresses during peak periods of demand. However, the market has entered a deflationary phase, with the average price declining from $22 per address to as low as $9, underscoring the reduced demand in the face of evolving network architectures and IPv6 advancements.
Industry Impacts and the Necessity of IPv6 Adoption
The telecommunications and cloud industries are at the forefront of the IP address evolution. Amazon, for instance, dominated the market in acquiring both transferred and newly routed IPv4 addresses to meet its enterprise cloud service demands. However, as IPv4 allocation stagnates, IPv6 adoption is seen as inevitable to maintain scalability and innovation.
IPv6 introduces a 128-bit address space capable of supporting 340 undecillion (3.4 x 1038) unique addresses, effectively solving address scarcity concerns. However, its deployment has been uneven globally. As of 2025, IPv6 accounted for less than 34% of allocated addresses globally, many of which remain unadvertised due to a lack of deployment urgency. Notable progress has been made in countries like India and China, where major ISPs have actively transitioned to IPv6 due to the strain of supporting massive user bases under IPv4. For instance, 94 million new IPv6 users were added in China between 2024 and 2025, boosting the country’s IPv6 penetration to 54%.
Despite progress, the global average adoption rate of IPv6 is growing at just 3.7% annually, signaling that significant barriers remain. These include operational hurdles, lack of client-side preparedness, and the continued reliance on NAT-enabled IPv4 infrastructure, which remains cheaper in the short term for many ISPs and enterprises.
Looking Ahead: The IP Address Ecosystem at a Crossroads
While IPv6 adoption rates inch forward, both IPv4 and IPv6 coexist in a dual-stack networking environment. However, this approach is transitional. A complete pivot to IPv6 is crucial to unlocking innovations tied to IoT, 5G, and advanced cloud platforms. Failure to migrate could deepen fragmentation and complicate interoperability across the global Internet infrastructure.
Experts predict a tipping point when the rising costs of IPv4 NAT solutions outweigh IPv6 implementation expenses. Enterprises like Amazon—an early IPv4 hoarder—may soon join the movement toward IPv6 as customers demand greater scalability, reduced latency, and cost-effective solutions. Further, secondary market trends indicate that older IPv4 allocations are being consolidated; these are typically blocks allocated 13–25 years ago as opposed to recently allocated chunks.
In regions such as North America and Europe, some ISPs have aggressively pivoted to IPv6. For example, Comcast and Google Fiber have enabled IPv6 for consumer services at a significant scale, demonstrating its technical feasibility and scalability. Global IPv6 deployment, however, will rely on a deeper commitment from Tier-1 ISPs, regulatory bodies, and emerging economies to create universal mechanisms for incentivizing adoption.
Key Takeaway
The depletion of IPv4 and the slow transition to IPv6 highlight systemic challenges that require global collaboration. Without addressing deployment fragmentation, the Internet risks long-term inefficiencies and stagnation. Adoption will ultimately depend on bridging cost gaps, incentivizing enterprises, and educating stakeholders about the benefits of IPv6.
What are your thoughts on the IPv4 scarcity and the industry’s slow pivot to IPv6? Have enterprises waited too long to act, or is the dual-stack solution sufficient? Share your views in the comments below!
