Ofo, a leading bike rental company in China, has set up a research institute to tackle urban bike sharing management problems with blockchain technology, the company announced May 17. According to its press release, ofo’s blockchain research institute aims to use blockchain technology globally to further facilitate big data and IoT (Internet of Things).

“This aims to better bind multiple parties including enterprises, governments and users, in order to find solutions to problems in bike sharing operation such as bike deployment, redistribution, parking and maintenance, help build smart urban transportation globally.”

The move is geared towards solving the mounting problems of left-behind bikes on China’s streets. Last year, regulators issued parking guidelines (in Chinese) to encourage bike users to park in an orderly manner, but the guidelines were not strictly imposed.

Local governments had already imposed bans on hire bike companies adding more bikes. Back in August 2017, Shanghai banned any more hire bikes (and by November 2017 ofo was reported to be deliberately making new bikes look dirty and old to sneak them onto the streets). In May this year, Beijing started reinforcing electronic fences for bike rentals.

Bike rental companies have been struggling to keep cities orderly. An investigation by Q Daily in December 2017 revealed that bike rental companies have been avoiding collection of bikes impounded by city authorities to avoid costs. Q Daily journalists learned from the Hangzhou Municipal Commission of Urban Management that the labor cost of retrieving a single bicycle is RMB 9.6.

Another issue is dumping unused bikes. Thousands of bicycles can now be seen on the edges of many cities in China. Their sheer scale and waste have been making headlines worldwide. It was also discovered that rental bikes are deliberately being damaged. Last week, a whole graveyard of bikes was discovered with unlocked ofo rental bicycles buried under construction waste in Chengdu.

Masha Borak is a technology reporter based in Beijing. Write to her at masha.borak [at] technode.com. Pitches with the word "disruptive" will be ignored. Read a good book - learn some more adjectives.

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