Microbial encapsulation with hydrogels has been proposed as a promising option to improve the deployability of anaerobic technologies. In particular, leveraging reactors with encapsulated microbial communities has the potential to achieve (i) low-energy, reliable retention of slow-growing biomass, (ii) fast startup, (iii) reliable treatment, and (iv) protection for the microorganisms from exposure to adverse conditions such as acid or toxin shocks in the influent. Microbial encapsulation with hydrogels is still emerging in the field of wastewater treatment and resource recovery, with limited bench-scale experimental studies using anaerobic microorganisms. The implications of the use of encapsulant on anaerobic process kinetics, design and operational requirements, and ultimately the life cycle cost and environmental impacts of the system are still highly uncertain.