The Chinese blockchain industry is still flourishing, given the economic impact of the coronavirus pandemic. The Chinese authorities have licensed more than 10,000 new blockchain firms so far in 2020, according to blockchain analytics firm LongHash. Most of these businesses have business assets worth as little as 5,000 yuan.
Notably, with about half of the year remaining, the number of new registrations in China this year is the third-highest, only eclipsed by the previous two years. China saw its highest number of new blockchain firms set up back in 2018, hitting the same highs again in 2019. However, given the current rate of growth in the Chinese blockchain sector, the number of new registrations will exceed the year before, as per the analytics firm.
#COVID19 hasn’t stopped China’s blockchain boom. 10,000+ new blockchain companies have been established in the first 7 months of 2020. Number of new companies on track to surpass those established in 2019. Chart 👇 pic.twitter.com/yP6XSeU8bl
— LongHash (@longhashdata) August 8, 2020
Blockchain firms closing down in China
There are currently a total of 84,410 registered blockchain firms in china. Out of this massive figure, only 29,340 firms are operational. Most of these new firms are based in the Chinese province of Guangdong, followed by the southwestern province of Yunnan.
Notably, most of these blockchain startups were established using small capitals as per the analytics firm. The majority of these blockchain startups were registered with only 5,000 yuan (about $719). Nevertheless, a small number of startups have a registered operating capital of more than 50,000 yuan ($7,175).
Chinese blockchain industry growing despite China banning crypto trading
Even though the Chinese authorities prohibited crypto trading and ICOs three years ago, the Chinese blockchain industry is still accelerating. The industry is instead growing substantially. Indeed, early this year, the Chinese congress reviewed a national blockchain fund bill that aims to promote innovation in the sector.
Furthermore, China has a total of 224 recognized blockchain projects which involve technology behemoths such as Walmart and Baidu. Interestingly, the PBoC is also on the verge of issuing digital yuan, while also participating in a variety of other blockchain-related projects.