Chinese businesses patented more than 6,000 blockchain applications worldwide as China Accepts Public and Private Blockchains. The first to embrace blockchain was Baoshan District in Shanghai — the first industrial park was opened there in November 2016. It was designed not only for government, but also for financial and other sectors. Soon after Shanghai other cities, such as Hangzhou or Suzhou, opened their parks, with a total investment reaching 170 billion RMB ($24 billion). Most of the funds came from the government, and, regarding this and the amount of blockchain platforms no surprise that China wants to be a leader in the industry.

Over the past several years Chinese businesses patented more than 6,000 blockchain applications worldwide. BAT (the acronym for Baidu, Alibaba and Tencent) performed even better, as Alibaba holds 534 patents alone. Many large commercial organizations such as China Merchant Bank, establish partnership with blockchain companies such as Cryptape.

However, China always was against abusive use of blockchain technology, cracking down on ICOs (initial coin offering) and fiat-to-crypto trading in 2017. Chinese government took such steps trying to protect the citizens from possible scams.

In spite of this, China has always been the most active secondary market in the industry attracting global projects. This means that China may become the country with the largest amount of consortium chains and approved blockchains (for instance, all BAT projects are within the consortium chain).

Active secondary market

The market in China grew swiftly due to several reasons. Immense mining activity lured many coin holders, as Chinese middle class is more interested in investments, and cryptocurrency market allows for getting round the country’s regulations by diversifying portfolios.

This leads to appearance of numerous cryptocurrency exchanges, although few are known abroad, besides Huobi and OKex.

Recently China has taken more steps to stop illegal blockchain activity, investigating several small exchanges and forcing others to change their business models.

Future of blockchain in China

After President Xi Jinping stressed on the adoption of blockchain as a priority, it is expected that the development of the technology will be lavishly funded.

Blockchain education is also provided by Chinese colleges and universities, the government conducts many educational events about the technology every day.

As most of the blockchain projects remain permissioned and some of them, especially government ones, are deemed sensitive, the Chinese regulators have understood that public chains are also important because of their decentralized nature.

Though the government is still suspicious about public chains, it has possibly understood that harnessing them is difficult, therefore their potential should be explored and promoted.

This is the main reason for the cooperation between Shanghai government and Conflux when they founded a Blockchain Research Institute — they are looking forward for developing a next-generation global blockchain ecosystem. Although centralized control contradicts the views of blockchain supporters, major commercial players will need time to shift to large-scale decentralized finance.

The national digital currency will help spread the concept globally and give other countries access to underlying resources in case they need it. This would be a major breakthrough for blockchain technology as well as for world economy.