A new report commissioned by the People’s Bank of China and published by a group of financial and technology authorities in the Asian power reveals further details about how companies engaged in blockchain innovation are operating. According to the collected data, the vast majority have tried to launch their own cryptocurrencies despite the Chinese government’s insistence on restricting the use of these financial instruments and prioritizing applications of decentralized technologies.
Yedong Zhu: 25,000 blockchain firms in China have attempted to launch their own tokens
The president of the Beijing Association for the Application of Blockchain Technology provided additional insight into Chinese companies active in the blockchain space. According to the Chinese news portal NBD (National Business Daily), 89% of companies in China’s blockchain sector have sought ways to issue their own tokens. That figure corresponds to more than 25,000 firms across the People’s Republic.
It should be noted that initial coin offerings (ICOs) were banned by the Chinese government in September 2017. While China has adopted a renewed stance on the use of decentralized technologies and President Xi Jinping has urged acceleration of their development, the government remains wary of uncontrolled models such as bitcoin. Trading in these assets has also been affected by limits placed on multiple trading platforms and exchanges.
The data were compiled by five financial and technology authorities at the initiative of the country’s central bank. The report also shows that there are more than 28,000 companies in China’s blockchain sector, but only about 4,000 are genuinely focused on developing applications that use the underlying technology. The so-called “Blockchain Blue Book” aims to contribute guidance for regulating the industry. In addition, the report highlights the importance of regulation and the need to prevent companies from raising funds illegally or misusing government support programs.
Bitcoin briefly tests six-month lows near the $6,500 area
China continues to influence market sentiment in the industry, and many believe the country’s approach helped trigger October’s bullish rally, as well as the recent sharp decline. In the linked analysis, other hypotheses are explored, including technical analysis factors. In any case, the latest market drop led bitcoin to retest support for the second time since the bullish breakout in May, which had resulted in a shift in market structure. Bulls have shown some reaction around the $6,500 level, but there is no confirmation yet of a breakout against the prevailing downtrend.
Meanwhile, altcoins fell to levels some observers describe as capitulation. Today’s rebound has not been sufficient to reverse the broader downtrend, and bulls will need stronger momentum to change the market outlook. Below is a visual summary of the price balance for major cryptocurrencies and their percentage changes over the past 24 hours:
