Bitcoin Market Decline is Impacting China’s Blockchain Crypto Companies
Cryptocurrency Decline Impacts Chinese Companies
Various Chinese listed companies have had ambitious blockchain development goals. However, it seems that such ambitions are being derailed by the decline in cryptocurrencies.
China Money Network reported that 34 listed companies had announced major plans to join the blockchain craze, but only nine have actually developed actual services and products on the space. The report also estimates that there were more listed companies with significant blockchain plans, but were not interviewed by the exchange.
Securities Times, a Chinese media company, released a report showing that the 34 firms include companies surveyed by Chinese stock exchanges to inquire about their blockchain ambitions.
The report found that share prices of Chinese listed companies that had announced blockchain plans increased in late 2017 and early 2018. But, many of the companies later determined that the decline in cryptocurrency derailed their ability to develop blockchain projects. Accordingly, many had to reassess the need for token-based solutions with a traditional approach.
Yu Rui, chef analyst on Blockdata, determined that a significant portion of the nine companies with blockchain applications are geared toward the financial industry. Many of the firms have concentrated research and development, investment, and high patent quality.
Rui also added that “I believe in the next two years, there will be more substantive results.”