Despite the ongoing pandemic, blockchain growth in China is booming and may outpace 2018
Blockchain analyst LongHash reported that the number of new blockchain-related businesses in China are at near-record levels. The analyst emphasised in the first seven months of this year that over 10,000 new blockchain companies have been registered.
After President Xi Jinping’s speech in 2018 on blockchain being China’s main technological focus, the whole industry has taken off in a big way. Blockchain businesses were registering by the thousands as demonstrated in the graph provided by Long Hash.
The number of blockchain business registering peaked in 2018, where over 18,500 businesses signed up.
Seven months into 2020, the number of registrations have already surpassed 2017. Experts at LongHash pointed out with the current growth rate, 2020 could potentially surpass 2018. Currently, in total, there are roughly about 84,410 registered blockchain companies in China.
Look a little deeper
Boasting an aggregate of 84,410, the truth is that less than half of these businesses are actually functional. It isn’t difficult to register a business in China, and it isn’t likely that most of these blockchain companies will make a big impact on the technology due to a lack of funds.
The Chinese Government has been aggressively encouraging the development of blockchain technology, but the truth is that blockchain startups are majorly underfunded.
According to Financemagnets, many startups registered with only $717, not much in the world of blockchain development. With a proposed blockchain development fund incoming, it is unknown how long some of these businesses could stay afloat in the rapidly evolving industry.
Speeding things up
In July, Beijing reported that at least 140 government agencies are adopting blockchain. Many government services that use blockchain have reported saving up to 40% in paperwork, which is a substantial gain in productivity.
There are currently 224 blockchain projects in China that are receiving help from prominent names such as Alibaba, Baidu, Huawei and Walmart. Most notably Huawei, known for its collaboration with the central bank, is working to roll out the digital yuan.
As a major exporter, China needs to be able to move goods efficiently, which blockchain can help with. The digital Yuan could be integrated into existing payment platforms, both at a retail and commercial level. This may drive adoption, if people are willing to do business in a Chinese digital currency.