China seems to have has taken the lead in adapting blockchain as well. It has beaten U.S and Japan as well in filing for the largest number of patents in Blockchain technology. Interestingly, the same Chinese government which had banned exchanges and trading in China is funding a $1.6 billion Blockchain Fund to encourage applications of this technology.
As reported on April 9 in Chinese Publication, Sohu, the government of Hangzhou has taken a decision to invest more than $400 million in a Hangzhou based venture capital firm known as Tunlan Investment. The purpose is to facilitate growth of Blockchain startups and projects. The company has launched a Blockchain Industrial Park in association with the government to promote projects worth $1.6 billion where 30 percent of the projects would be promoted by the local government. Advisors like Xu Xiaoping , who are founders of companies like Zhenfund have shown keen interest and have already invested in projects like Steem and Lino which are Ethereum based content distribution platform.
This industrial park is one of the latest efforts by the Chinese government in its endeavour to grow Blockchain in the country. Its interesting how the same government took steps to stop cryptocurrency trading. In September , 2017, the same government had put a complete ban on cryptocurrency trading in the country and asked exchanges and Financial Institutions to seize all operation regarding cryptocurrencies. The former two largest cryptocurrency exchanges which were known as Huobi and OKCoin changed and rebranded to Huobi Pro and OKEx and expanded into the South Korean market from there. During the period of September to December in 2017 the Chinese government had declared Bitcoin and Ethereum to be threats to the central bank and the current financial system of China.
Change in the attitude of the government
The Chinese government has slowly realized the effort and solutions that blockchain can provide to a large population of the country but it is also cautious in his approach as recently stated by a quote in the The People’s Daily :
“The mainstream Blockchain technology platforms all originated from abroad. The domestic Blockchain technology service providers should patiently start from the ground floor to make technologies independent and controllable, and strive to lead global Blockchain technology development.”
The Chinese government has slowly warmed up to the blockchain projects to start from the ground and also ensured commercialization to the end.It definitely sees it as a potential revenue stream in the future.
As estimated by Thomson Reuters and the World Intellectual Patent Organisation, China already has about 400 patents in the blockchain industry within the past 2 years. This is way ahead of the U.S and Australia who stand at 110 and 40 patents respectively.
Various Chinese companies have started pilot projects and testing with real- time data in a decentralized manner. The biggest of fintech companies in China such as AliPay and TencentPay have already given assurances to start implementing blockchain based payment systems along with few insurance companies have already started to use blockchain.
There are various companies like JD.com which is a major Chinese retailer currently using blockchain technology. Insurance firm ZhongAn has been using it to trace and monitor life cycles in the poultry industry. There are various other use cases like these and the Chinese government is undergoing a steep learning curve by recognising acknowledging and implementing blockchain in way at various levels of functioning for the country.