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Here’s How Big-spending Chinese Firms Use their Blockchain R&D Money

Tim Alper
Last updated: | 2 min read

A new study of how Chinese firms have been making use of the millions of dollars they have injected into blockchain technology has found that companies are prioritizing government-related developments and financial sector solutions.

Source: Adobe/amixstudio

The report, published by Securities Daily (via East Money), looked at how 23 publically listed companies have been spending the funds they have invested in blockchain-themed R&D since 2016, the year when larger Chinese firms “began testing the waters” of blockchain research.

The likes of Yuanguang Software, primarily an enterprise software provider, have increased their R&D spending by just under 7% per year – around USD 24.3m since 2016 – with much of that money going directly to blockchain-themed research efforts.

In many cases, companies are channeling a whopping 20% of their annual revenues into R&D, again, with blockchain taking the lion’s share.

A number of Yuanguang Software blockchain solutions have passed the product planning review stage, the media outlet added, including a digital education platform and a financial service platform designed for use in the energy sector.

Another firm, Hailian Jinhui, a steel industry player with stated “digital currency” interests, has applied for almost 50 blockchain patents and has been engaged in blockchain standardization efforts.

Although real-world applications are still largely in the pipelines, Chinese firms appear to believe that a breakthrough in commercialization is on its way, with a prominent IT professor opining that most firms consider that patents will provide them with a “competitive weapon” in the blockchain race.

A “majority” of the surveyed companies have looked to implement government-focused developments, particularly as a number of central and local government organs have been so keen to introduce blockchain-powered data sharing and exchange, business collaboration, and digital documentation solutions.

The media outlet reported that a total of 32 provinces and municipalities across the country have already issued blockchain-related policy documents – a further sign of growth for the blockchain sector in the public sector.

Banks and financial organizations, too, are becoming increasingly blockchain-keen, and are keen to boost contact-free, digital solutions pertaining to account registration and management, invoicing, bookkeeping and tax-related matters.
Learn more:
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Blockchain Adoption Lacks Evidence, Firms Use It For Non-Existing Problems – Report