New York-based research firm CB Insights, which relies on artificial intelligence for analyzing data on private companies, found out that venture capitalists rapidly started pouring money into blockchain-related Chinese startups in its freshly published report.
In 2019, China was responsible for 22 percent of all VC deals (compared to a minuscule two percent in 2015). In sharp contrast to that, the U.S.’s share declined from 51 percent to 31 percent over the same period of time.
China bets big on blockchain
The fact that VC deals are rapidly moving to China comes as no surprise since it’s clearly shaping up to be a new world leader in blockchain.
In late October, President Xi Jinping himself urged the country to ‘seize the opportunities’ presented by the technology. China’s blockchain spendings are estimated to top $2 bln by the end of 2023 despite the fact that Bitcoin has been banned in the communist state since September 2017.
Meanwhile, the U.S. is still plagued by regulatory uncertainty, which makes it cumbersome for venture capitalists to invest in the local blockchain industry.
Blockchain, not Bitcoin (yes, again)
The report also highlights how the blockchain fever that defined the 2018 bear market suddenly waned in 2019. CB Insights revealed that blockchain investments dropped by 60 percent last year.
However, after the massive coronavirus-driven sell-off, the ‘Blockchain, not Bitcoin’ narrative could take the central stage once again. The diversification of products, state-owned digital currencies, and the focus on the ‘easy-to-use’ dilemma are among some of the main trends of 2020.