Industries are stepping up efforts in blockchain technology to serve the real economy, even though the global cryptocurrency market could be facing tough times.
As of November, China led the world in new blockchain projects, with 263 in progress.
The figure accounted for about 25 percent of such projects globally, according to data service provider Blockdata in Beijing.
Blockchain refers to the technology that underpins cryptocurrencies, but its real value goes far beyond that. In the digital ledger system, transactions are recorded chronologically and publicly, ensuring that data is secure and not tampered with, while allowing it to be shared among a distributed network of computers without the involvement of middlemen.
The technology is used widely across a range of industries in China, like financial services, public services, healthcare, supply chains, smart manufacturing and logistics.
“The main strength of blockchain is in decentralized data management,” said Zhang Feixue, chief editor at Blockdata. “It can serve the real economy in terms of circulation and distribution. In the field of industrial economy, blockchain allows various assets to flow in the digital world, so it is a real gateway to digitalization for industries.”
Paul Sin, leader of the Asia Pacific Blockchain Lab at global advisory company Deloitte, said, “Whenever there is a need to synchronize data, especially sensitive information, across companies, industries and geographical boundaries, blockchain can offer a great solution due to its cryptographical protection of data.”
For instance, trade finance will allow banks to detect fraud, improve productivity and eventually enable small and medium-sized enterprises to obtain financing that was once unavailable to them. “This is a solid example of blockchain supporting financial inclusion and macroeconomic growth,” Sin said.
In Deloitte’s 2018 global blockchain survey, nearly 50 percent of respondents in China said the technology was already being used in their organization, compared with only 14 percent in the United States.
Li Qilei, chief technology officer at Qulian Technology, a block chain platform developer in China, said the financial industry is now the biggest user of the technology in areas such as asset securitization for banks and brokers.
Take Qulian, for example. On an accounts receivable platform it developed with China Zheshang Bank, the scale of financing has reached hundreds of billions of yuan since its launch in August 2017.
Qulian, in Hangzhou, capital of Zhejiang province, launched Hyperchain, which focuses on enterprise-level network solutions for companies, government agencies and industry alliances.
In June, the company said it had raised a series B round of financing of 1.5 billion yuan ($222 million) – the largest amount in the domestic blockchain industry at the time.
In addition to linking with financial services, Li said blockchain can be applied in other areas such as green energy and smart government. Qulian is also working with some housing bureaus to build a trusted property chain, with the aim of preventing fake housing information appearing online.