China is rapidly catching up to the United States with regard to blockchain-related investments, according to a recent report put together by New York-based research firm CB Insights.
The researchers found that the East Asian country accounted for 22% of blockchain investments in 2019, compared to 31% for the U.S. This represents a significant improvement for China when compared to 2015, when it had a meager 2% while the U.S. was getting 51% of total funding.
Headlined by the trade dispute of 2019, competition between the U.S. and China has intensified in recent years. Thats unsurprising considering theyre the two largest economies in the world. At best, however, the findings of this CB Insights report only suggest that U.S.China competition is intensifying in the blockchain space as well. It doesnt give a clear picture of which country is ahead in blockchain development.
In addition, given that there is a slew of conflicting blockchain investment reports out there, its difficult to say for sure just what proportion of global blockchain investment goes to either country. For instance, according to CB Insights, 2019 saw a global investment volume of about $2.8 billion, down from $4.2 billion in 2018.
Earlier in this year, Xinhua Chinas state-run financial media firm and financial data platform Rhino Datareported that Chinese investment deals came in at around $3.44 billion (24.4 billion Chinese yuan) across 245 deals in 2019. This represents a 40.8% drop in investment volume when compared to 2018, the report stated.
Experts say that the majority of the investment in China originates locally for now, but they expect more foreign funds in the near future. Kevin Shao of Bitrise Capital Partners told Cointelegraph that:
Currently, the main investors are mainly domestic venture capital institutions and individual investors as early stage investors. However, we believe that with the increasing internationalization of Blockchain technology, the percentage of foreign investment institutions will increase over time.
There arent any readily available reports focused solely on how much blockchain investment happened in the U.S. last year, but again, the figures from CB Insights mostly show that the blockchain scene in China is picking up. Instead of looking at the figures, it might be worth considering the actual events, including the governments stance, talent distribution and enterprise involvement to obtain a feel for how blockchain competition is shaping up between the two countries.
In October 2019, Chinese President Xi Jinping publiclysupported blockchain technology by urging the country to take blockchain as an important breakthrough independent innovation of core technologies and to accelerate its development. According to blockchain accelerator Consensys, China has over 500 registered blockchain projects, with most of them led by the government.
As part of its support for blockchain, the People's Bank of China the countrys central bank is working to launch a digital yuan, which will be powered by a centralized blockchain. According to reports, the central bank has completed the essential development of the digital currency and is now in the process of drawing up legislation for its circulation.
The Chinese governments stance, led by President Xis speech, has had two effects on the blockchain development scene in the country. First, it has outlined the future path of the industry. Second, it has made mainstream the status of blockchain and promoted its orderly development, thereby opening more opportunities for new players to enter. Qi Qi, the CEO the of blockchain incubator B-Labs, told Cointelegraph:
On the capital side, domestic traditional funds are more willing to get involved, especially paying attention to the field of industrial blockchain, which is a big breakthrough for traditional funds and the blockchain industry itself.
Simon Li, a founding partner at Chain Capital, also told Cointelegraph that the Chinese government is actively embracing the blockchain and will use it in the government affairs system to create many application scenarios.
The U.S. government has a somewhat more cautious approach to blockchain. While a few government agencies mostly military are exploring the use of blockchain in the country, its still hard to say the government is particularly pro-blockchain, and this might limit the flow of blockchain investment in the country. Speaking to Cointelegraph, Sukhi Jutla, the co-founder of MarketOrders a blockchain platform for the jewelry industry said:
Although the U.S. is still a key leader when it comes to blockchain investments, it cannot compete with China. The US is hindered by regulations that are slow and dont keep pace with the innovations of technology. China is able to move with speed as their governments allow them the space to do what they need to do.
Jutla added, Many companies are bogged down by uncertainty and the threat of being sued as the regulations cannot keep pace with the fast-moving technology. Last year, Congress asked Facebook to stop advancing the cryptocurrency project Libra without proper supervision. The Securities Exchange Commission also continues to block Telegrams plans to launch its TON project. Still, the country has no clear plans for developing its own blockchain-based digital money.
The availability of talent is next to governmental influence as a determinant factor of investment flow, and experts believe the U.S. is ahead of China in the area of technical personnel. Kevin Ren, a founding partner at Consensus Lab, told Cointelegraph that despite the Chinese government being outwardly more supportive of blockchain, the U.S. has the edge thanks to the availability of talent:
Due to the shortage of technical personnel and infrastructure, China's current level of development in the area of blockchain still lags behind that of the United States. For example, the blockchain 3.0 project, such as Polkadot, Cosmos, etc., which currently leads the technological trend of blockchain, is mostly still a U.S. project.
Li also believes the U.S. has superior technical prowess. In a conversation with Cointelegraph, he said that there is still a certain gap between our technical level and that of the United States, but China sees great improvements in recent years, and the gap gets gradually narrowed.
China is famed as one of the countries where the adoption of new technology picks up the fastest. A 2018 report titled Me, My Life, My Wallet published by accounting giant KPMG found that consumers in China tend to be more receptive to new technologies, ahead of other top markets including the U.S., the United Kingdom and others.
This is evident in the area of mobile payment, where China leads the rest of the world in adoption. Ren believes that this readiness to pick up new technologies will give China the edge over the U.S. in the mid- to long-term, saying:
China's population base and netizen base, its ability to accept new things (Internet enterprises have completed user education through mobile payment and online shopping), and the constant supply of talents are the kinetic energy for China's blockchain to make great progress.
Brian Platz, the co-founder of Fluree an American company that builds blockchain-based databases told Cointelegraph that Chinas competitive advantage goes beyond its technology-receptive populace. According to Platz:
China may be leading in terms of adoption of digital and mobile payments, but that's only a piece of the blockchain pie. China is also heavily investing in enterprise blockchain infrastructure noting a clear thesis that blockchain technology can provide value across a variety of contexts. This is a powerful combination of adoption one that the U.S. should take seriously and accelerate plans to compete.
However, citing the opportunity for private enterprises to innovate more rapidly, Platz whose company is backed by Steve Cases venture capital firm Revolution believes that the U.S. can be the leader ahead of China in the blockchain scene, adding:
One clear advantage the US does have over China is the opportunity for private enterprise to freely innovate at a rapid pace. It's time to double down on enterprise blockchain efforts, garner support from the government, and build a competitive blockchain industry here in the US.
It has been widely reported in recent years that the majority of blockchain-related patents are held by Chinese entities. Technology news website The Next Web reported in March 2019 that Chinese entities had published 790 patents, while the U.S. had published 762. These figures represented the total, all-time patent publication by these countries.
However, the publication of patents in China appears to be dominated by a few entities, given that the number of U.S. enterprise players invested in blockchain is significantly more than that of China. The business publication Forbes recentlycompiled a list of the top 50 enterprises that have invested into blockchain, and the list is dominated by American firms across different sectors.
To be on the list, the company had to be generating at least $1 billion in annual revenue or have a valuation of at least $1 billion. American companies took up 58% of the list with 29 entries, while only four Chinese companies were featured.
The answer to who is ahead in blockchain development between China and the U.S. depends on who is asked and how they best see the application of blockchain in reality. The two economic giants are following different development paths, with blockchain advancement in China spearheaded by the government and development in the U.S. spearheaded by corporate enterprises.
According to Shao, blockchain development in the two countries is evolving in different directions, making it difficult to declare a clear leader. He stated:
Compared to the United States, China is taking a different path and we cannot compare which path is better or more advanced at the time. China's blockchain industry is focusing on governance, finance and civil fields. But in the financial-related fields, the Chinese government is more cautious and strict compared to the U.S. government.
James Wo, the CEO of U.S.-based Digital Finance Group, also believes that the two countries are approaching blockchain development differently. He said:
I think they have different directions. U.S. cares more about solving infrastructure-level problems including interoperability, scalability etc. While China cares more about the usage of blockchain.
On the other hand, the CEO of B-Labs believes that both China and the U.S. are at the forefront regarding blockchain technology, but the narrative should be that of cooperation:
All the issues that have happened recently make us realize the meaning of a community of shared future for mankind, and aware that global technological cooperation is an essential element for building such a community, in the way from R&D, patents, talent cultivation and beyond.
See the article here:
- Blockchain Explorer - Coinmarketcap - February 10th, 2021
- Forbes Blockchain 50: Meet The Bitcoin Lovers In Corporate America - Forbes - February 10th, 2021
- Global Blockchain Technology Market Report 2021-2026: Accenture will Lead the Charge for Systems Integration and Companies like Amazon, Dell, HPE, and... - February 10th, 2021
- Global Business Automation Blockchain Technology and Internet of Things Market Report 2020-2025 with Profiles of 42 Vendors - PRNewswire - February 10th, 2021
- Global Blockchain Technology in the Healthcare Market Research Insights, Latest Trends, Major Player - PharmiWeb.com - February 10th, 2021
- COVID Spurs Tokenization via Blockchain Tech in Commercial Real Estate - Commercial Observer - February 10th, 2021
- Blockchain startup ITM collaborates with Microsoft and MediaTek to address the crisis of trust during the COVID-19 pandemic - PRNewswire - February 10th, 2021
- How Polestar is using blockchain to increase transparency - The Next Web - February 10th, 2021
- Blockchain transactions confirm murky and interconnected ransomware scene - ZDNet - February 10th, 2021
- Matic Network Pivots to Help Ethereum Fight Blockchain Rival - Decrypt - February 10th, 2021
- IT Min suggests blockchain use in public projects - The Indian Express - February 10th, 2021
- Blockchain Bites: The Weird and Wonderful in Crypto This Week - Yahoo Finance - February 10th, 2021
- Poland records Treasury Bonds on a blockchain - Finextra - February 10th, 2021
- As Tesla bets on Bitcoin, should antitrust regulators be looking at blockchains? - Lexology - February 10th, 2021
- Healthcare Blockchain Market Report 2011: Manufacturers, Countries, Type and Application, Global Forecast To 2028 KSU | The Sentinel Newspaper - KSU... - February 10th, 2021
- Lloyd Purser looks to blockchain to draw in new generations of customers - CalvinAyre.com - February 10th, 2021
- Blockchain Bites: The Weird and Wonderful in Crypto This Week - CoinDesk - CoinDesk - February 6th, 2021
- Blockchain Innovation Done the Polkadot Way According to Gavin Wood Altcoins Bitcoin News - Bitcoin News - February 6th, 2021
- BitBoss announces integration with DotWallet to offer native iGaming experience using Bitcoin SV blockchain - PRNewswire - February 6th, 2021
- Learn the Fundamentals of Blockchain and Cryptocurrency for $25 - PCMag.com - February 6th, 2021
- Ethereum Blockchain Records 1 Billion Transactions - Decrypt - February 6th, 2021
- Blockchain Technology and Internet of Things in Business Automation Markets, 2020-2025: Blockchain Technology and IoT Authentication, Authorization,... - February 6th, 2021
- Insights on the Blockchain in Manufacturing Global Market to 2026 - Asia-Pacific is Expected to Dominate the Market - ResearchAndMarkets.com - Yahoo... - February 6th, 2021
- Russias regulatory sandbox and the implementation of blockchain tech - Cointelegraph - February 6th, 2021
- The blockchain-based virtual world that can help usher in the metaverse - VentureBeat - February 6th, 2021
- Blockchain start-up Retraced raises another EUR1m in funding - just-style.com - February 6th, 2021
- Blockchain Cuties Universe to launch DeFi and NFT tokenomics - Cointelegraph - February 6th, 2021
- The India stack that Bill Gates and Sundar Pichai so love is set to get much bigger thanks to the Indian gov - Business Insider India - February 6th, 2021
- DAEM Technology Launches ixWallet and the First Bitcoin Red Packet in Hong Kong to Promote Blockchain Payment Education - Business Wire - February 6th, 2021
- Rare Sneaker App Switches From Ethereum to Hedera to Skip Blockchain Fees - CoinDesk - Coindesk - February 4th, 2021
- Crypto Taxes Make Headlines, But Blockchain Might Be The Key To Real Time Reporting - Forbes - February 4th, 2021
- IBM Blockchain Is a Shell of Its Former Self After Revenue Misses, Job Cuts: Sources - CoinDesk - Coindesk - February 4th, 2021
- The Decade of Blockchain: What That Means for Industry - RTInsights - February 4th, 2021
- Blockchain and Energy Innovation Marches On POWER magazine - POWER magazine - February 4th, 2021
- Another Oil Giant Joins The Blockchain Bandwagon - OilPrice.com - February 4th, 2021
- Government Will Explore Blockchain for Digital Economy, Union Minister Says About India's Own Cryptocurre... - Gadgets 360 - February 4th, 2021
- Jimmy Nguyen to explore benefits of Bitcoin SV at Saxion Blockchain Week - CoinGeek - February 4th, 2021
- Forbes Publishes Its Top 50 Blockchain Firms of 2021 - Crypto Briefing - February 4th, 2021
- Blockchain will revolutionize healthcare Just not any time soon - Cointelegraph - February 4th, 2021
- Government to explore use of blockchain technology for ushering in digital economy - YourStory - February 4th, 2021
- HashCash's Blockchain Solutions to Act as a Game Changer in the Trade Finance Industry - WFMZ Allentown - February 4th, 2021
- Blockchain and Energy Innovation Marches On - POWER magazine - POWER magazine - January 29th, 2021
- Bitcoin and blockchain 101: Why the future will be decentralized - Big Think - January 29th, 2021
- 3 Banks That Have Big Plans for Blockchain and Cryptocurrency - Motley Fool - January 29th, 2021
- How COVID-19 Has Amplified the Need for Blockchain Provenance - Supply and Demand Chain Executive - January 29th, 2021
- Real-Time Blockchain-to-Everything Platform PARSIQ (PRQ) Now Listed on OKEx Press release Bitcoin News - Bitcoin News - January 29th, 2021
- Global Blockchain Technology in the Healthcare Market 2021-2028 Study & Future Prospects Including k - PharmiWeb.com - January 29th, 2021
- What We Don't Know About Bitcoin and Why It's a Problem - Built In - January 29th, 2021
- Webcast: Beyond Bitcoin: How Blockchain is Transforming the Investment Industry - ETF Trends - January 29th, 2021
- Graph to explore rolling out several new Layer 1 integrations, including one for Bitcoin - The Block Crypto - January 29th, 2021
- Ethereum-Based ConsenSys Quorum Partners With Chinas BSN Blockchain - CoinDesk - CoinDesk - January 29th, 2021
- New Year, New Legal Focus: The Impact of Cryptocurrencies and Blockchain Law - JD Supra - January 29th, 2021
- RIOT Stock: 6 Things to Know About Riot Blockchain as Share Prices Soar - InvestorPlace - January 29th, 2021
- Blockchain tech may have arrived too soon, but now, its ready - Cointelegraph - January 29th, 2021
- Experts dwell on Blockchain tech - The Hans India - January 29th, 2021
- Blockchain Ensures Vaccine Custody, Patient Immunity - Supply and Demand Chain Executive - January 29th, 2021
- Blockchain Bites: Digital currencies cruise into the Davos World Economic Forum discussion; Bolstering eSafety with blockchain?; Rise in ransomware... - January 29th, 2021
- The Isle of Man continues to create blockchain-friendly policies - CoinGeek - January 29th, 2021
- As Blockchain Technology and Cryptocurrency Mature, so Do Their Regulation and Enforcement - Lexology - January 29th, 2021
- Blockchain In Healthcare and Fintech: Will There Be an Impact? - Onrec - January 29th, 2021
- BitAngels Los Angeles to Host First Hybrid Blockchain and the Future of Work Event on Jan 27 - GlobeNewswire - January 29th, 2021
- Why blockchain just might be the answer to better construction - The Fifth Estate - January 29th, 2021
- Regtech Group formed by Steering Committee of Australias National Blockchain Roadmap Wants to Know if DLT will Improve Business Processes - Crowdfund... - January 29th, 2021
- Robbie Ferguson: The Blockchain NFT Wars Are Here - CoinDesk - CoinDesk - December 22nd, 2020
- Blockchain trends in 2021: Expect the unexpected - Finextra - December 22nd, 2020
- Why Stocks of Bitcoin Miners CleanSpark, Marathon, and Riot Blockchain Were Up Again Today - Motley Fool - December 22nd, 2020
- CryptoCurrencyWire Collaborates with Blockchain Africa Conference 2021 as Official NewsWire, Africa's Leading Blockchain Event - GlobeNewswire - December 22nd, 2020
- ROCKI, the new music streaming platform on the blockchain just launched their first Royalty income right music NFT (Nonfungible token) for a song,... - December 22nd, 2020
- WISeKey upgrades its WISeCoin blockchain technology with AI capabilities and integrates physical and digital world in terms of value - GlobeNewswire - December 22nd, 2020
- Blockchain Veterans Create Blockcap, a Massive Bitcoin Mining Operation in North America - Business Wire - December 22nd, 2020
- WISeCoin, the Innovative Tokenized Service of WISeKey, Authenticates People, Products and Machines Using Blockchain and AI - GlobeNewswire - December 22nd, 2020
- What is enterprise blockchain? Everything you need to know - TechRadar - December 22nd, 2020
- FICO partners with Crystal Blockchain to combat cryptocurrency ML - The Paypers - December 22nd, 2020
- Grant Thornton Cyprus Becomes An Authority Masternode On VeChainThor Public Blockchain - PRNewswire - December 22nd, 2020
- DeNations, a Blockchain-Powered Metaverse, Launches the First INO - Initial Nations Offering | Press release - Bitcoin News - December 22nd, 2020
- VeChain Foundation Announces Partnership With the Royal Melbourne Institute of Technology (RMIT) Blockchain Innovation Hub, Accelerating Blockchain... - December 22nd, 2020
- SFOX Named to Blockchain 50 Ranking by CB Insights and Blockdata - PRNewswire - December 22nd, 2020
- Topl Closes $3M Seed Funding Round, Builds Blockchain for Environmental, Social and Governance (ESG) Global Initiatives - Business Wire - December 22nd, 2020
- AICPA Whitepaper Focuses on Conducting SOC Audits Involving Blockchain - CPAPracticeAdvisor.com - December 22nd, 2020
- Web 3.0 Infrastructure Blockchain The Graph Now Live on Ethereum - Yahoo Finance - December 22nd, 2020