China’s blockchain startups saw cumulative funding to the tune of justunder $3.5 billion in 2019, according to a new report.
The study, from Xinhua Finance and Rhino Data, found that a total of 245investments had taken place with a total figure of approximately 24 billionyuan ($3.48bn, ?2.66bn). The volume of investments, as well as the moneyraised, represent a roughly 50% decrease from 2018. The report notes hope forhealthier development in 2020 with more rational capital support.
In terms of where the money came from, the majority of investments camefrom crypto funds, rather than more traditional venture capital routes. Traditionalfinancing dwindled as the year progressed. Early year financing – comprising eightseed rounds, 46 angel rounds and 52 series As – formed 43.3% of totalinvestment. At the start of the year, the report notes, this represented 62% oftotal funding, dropping to 31.9% in the fourth quarter.
The year started off slowly, with only 21 events in February and Marchbefore a major spike. 73 events comprised the second quarter, with a peak of 8.3bnyuan in April, higher than any monthly amount raised in 2018. The report cites Taipei-basedBitfinex’s $1bn private token sale as the primary factor behind the upturn.
Other major players this year, cited by the report, are Jianan Yunzhi, aminer, and data security blockchain platform ABS Chain – the acronym standingfor AI, blockchain and security – raised $50 million from a Saudi Arabia-basedinvestment in June. The news was not covered widely but it wasreleased under the parent company name, Most Caffeine Ltd.
Looking at the regional distribution of blockchain investment, thereport noted that Beijing saw the most financing events with 61, with Shanghai,Shenzhen and Hangzhou – the latter the home of Jianan – also frequently cited.
China’s relationship with blockchain technology has frequently been atesty one. Frequently taking a strong view on banning cryptocurrencies, themood appeared to have changed following intervention from president Xi Jinping.InOctober, Xi described blockchain as an ‘important breakthrough’. Followingthe president’s remarks, the state-run People’s Daily newspaper urged caution,noting that ‘blockchain’s future is here but we must remain rational.’
You can take a look at the full report here (translated from simplified Chinese).
