Blockchain and cryptocurrency are two of the most talked about buzzwords in the tech investment world. The ongoing crypto craze across the world has drawn many into the technology that only a handful of people fully comprehend.
Speaking at TechCrunch Hangzhou on Monday, July 2, Edith Yeung, head of Greater China at 500 Startups, highlighted top 10 crypto trends that will continue to dominate the world’s tech powerhouses.
1. The crypto world is flat and global
There was a time when Chinese tech projects weren’t considered “cool” in the West, Yeung said, but this is no longer the case—definitely not for blockchain projects. There are many promising Chinese projects that have built a really good brand in the US. Neo, Qtum, Tron, and Nebulas, are among many that have gained a lot of respect from the international community. Yeung added that a lot of the blockchain infrastructure projects need worldwide support in order to expand.
2. The rise of crypto hedge fund
Top investors in crypto projects are not the “classic VCs” like Sequoia or IDG, but a new class of investors like Fenbushi Capital and exchanges like Huobi and Binance who have an investment arm that actively invest in crypto projects. The same phenomenon can be observed in the US, Yeung added that “these are all new funds that have been set up in the past two years and they focus on investing in token projects”
3. Infrastructure protocols are still investors’ favorite
Projects in both China and the US are both actively focusing on building up blockchain infrastructure, working on areas such as scalability, cryptography, smart contracts, and sharding.
4. B2C protocols are rising in Asia
“B2C protocols are definitely more popular in Asia and China than the US,” Yeung said. For example, Castbox recently partnered with Beijing-based ContentBox, an infrastructure startup focusing on the digital content industry. Nervos is also another China-based blockchain infrastructure startup whose technology has been used in fan voting system of decentralized apps (dApps).
5. Private sale is raising more money than crowd sale
A majority of total funds raised for blockchain projects are mainly from private investors and the main reason is that it is very difficult to do KYC (know your customer) and identity for investors.
6. Asian exchanges are the driving force of global trading volume
Around 90% of trading volume is being managed by Asian operators. Figures from Coin Market Cap shows that 7 of the top 10 exchanges with highest daily trading volume are from China, and 9 come out of Asia. “You can see that Asian projects and Asian exchanges are drawing a lot of attention from the US and the rest of the world.”
7. Crypto is eating the fiat world
More and more crypto projects are now acquiring traditional enterprises. For example, Chinse blockchain infrastructure startup, Tron, recently acquired software company bitTorrent.
8. Crypto worldwide scam alert
Crypto projects are gaining traction in the investment space, but attention can be a double-edged sword. Yeung said around $9 million is lost in cryptocurrency scams each day, mostly through fraud and phishing. Celebrity-endorsed crypto projects, pump-and-dump schemes, fake websites, free token giveaways are some of the common crypto scams.
9. Government love-hate relationship with crypto
Over the past year, governments have come out to take a stand to make clear their positions toward cryptocurrency and blockchain. The Chinese government has banned ICOs, shutdown domestic exchanges. And around the same time, the US also made a similar statement that essentially declares its love for blockchain but not cryptocurrency.
10. Blockchain is the biggest buzzword for enterprises
Blockchain has been the biggest buzzword over the past year, Yeung said. A lot of the traditional enterprises are now getting more active in the crypto and token space because it bids well for them, their stock price, and brand. For example, Kodak’s stock jumped 44% when they announced their own token.
Even though it may seem that China and the US are competing in the same field, Yeung said this shouldn’t be a competition but a collaboration. Companies, entrepreneurs, developers in the US and China need to collaborate in order to expand blockchain protocols and the adoption of technology.