China’s blockchain sector continues to boom despite a global financial crisis catalyzed by the Covid-19 pandemic.
A report from crypto analytics platform LongHash reveals that more than 10,000 blockchain companies were formed in China from January to July 2020, exceeding the 8,595 recorded in 2017.
The crypto data company says the number of newly established blockchain companies in China is set to surpass the 13,885 firms formed last year.
#COVID19 hasn’t stopped China’s blockchain boom. 10,000+ new blockchain companies have been established in the first 7 months of 2020. Number of new companies on track to surpass those established in 2019. Chart 👇 pic.twitter.com/yP6XSeU8bl
— LongHash (@longhashdata) August 8, 2020
Guangdong Province hosts most of the country’s blockchain companies with 25,371 registered and operating firms, followed by Yunnan Province, with 5,174 blockchain-based businesses.
According to LongHash, most Chinese blockchain companies start with small initial funding. Nearly half of the companies started with a registered capital not exceeding 5,000 yuan, or about $719. Less than 10% had a registered capital of over 50,000 yuan or $7,175.
In addition, LongHash reports that many blockchain companies in China are having legal issues. Of the 84,410 registered blockchain companies, only 29,340 are still operating. 60,729 blockchain firms in the country have lost their legal status or had their license revoked.
Although China is a leading advocate of blockchain technology, the country continues to ban crypto exchanges and initial coin offerings.