China Blockchain Companies Surge By 10,000 This Year Despite Coronavirus

Blockchain companies in China have increased by over 10,000 in 2020, with the total number surging to 84,410 despite the coronavirus pandemic.

In the first seven months of 2020, more than 10,000 blockchain-related firms registered in China, more than the total figure reported in 2017. At the current rate, the number might surpass the record in 2018 when 18,500 blockchain-related firms registered in the country.

Crypto platform LongHash revealed that there are a total of 84,410 registered blockchain companies in China, of which 29,340 are operating. Also, 60,729 firms have lost their legal status or had their licenses revoked. Majority of these companies are based in the Guangdong and Yunnan provinces.

Guangdong’s history as a community of internationally active entrepreneurs as well as its proximity to Hong Kong likely contributed to why more blockchain companies are registered in the province, according to Forkast News. The publication also noted how Guangdong has published more blockchain-related policies than elsewhere in China. In 2019, the province issued “Blockchain 10 Points Policy” which established a 1 billion yuan fund to support the industry.

While the increase in blockchain-related companies could mean a surge in interest in the technology, 46% of these firms have a registered capital of only $717 worth in yuan. Around 24% of these companies have a registered capital of $1,435 to $7,175 and only 9% are registered with over $7,175.

LongHash said the term "registered capital" referred to the money contributed or committed by shareholders to the company. China requires this before they can operate. It does not reflect the overall resources of the company but LongHash said the higher the firm’s registered capital, the more resources it can bring.

To provide support, China’s Center for Information and Industry Development (CCID) also released a ranking of the top cryptocurrencies based on the blockchain’s basic technology, applicability, and creativity. In the 18th and latest edition of this report, Bitcoin has ranked 12 in the overall rankings despite ranking first in the creativity and innovation categories.