Chinese enterprise blockchain startup Nervos Network has raised $28 million from Polychain Capital and Sequoia China, joined by a long list of other blockchain investment firms including Wanxiang Blockchain (万向区块链), FBG Capital, Blockchain Capital, and Dekrypt Capital.
China’s blockchain industry has been growing rapidly over the past year and investors are pouring capital into blockchain and crypto companies. According to a recent blockchain investment report (in Chinese) released by China Venture, the number of blockchain companies in China has been rising for six consecutive years. From the beginning of 2018 to April, investment raised by blockchain companies totaled to more than RMB 6.3 billion, way ahead of the previous year in terms of scale and frequency.
As the company’s press release states, the new funding will be used to expand its product and engineering teams, accelerate the development of its enterprise blockchain technologies, as well as ramp up strategic partnerships.
There is a wide range of use cases of blockchain technology for enterprises, including payments, smart contracts, record-keeping, and supply chain management, but a recent survey by Gartner suggests that enterprise adoption of blockchain technology is still lagging. As more blockchain applications emerge, the existing infrastructures have shown limitations and are increasingly more difficult to meet the demands of today’s real-world solutions. Security and performance are two common issues surrounding existing infrastructures, where oftentimes having one means compromising the other.
“While there are undeniable benefits for enterprises that utilize blockchain technology to innovate and improve existing systems, enterprise adoption has been held back by a host of challenges like scalability, security, and complexity,” Jan Xie, co-founder and chief architect of Nervos said in a press release.
“The new funding will allow us to move full speed ahead as we build an infrastructure that will allow enterprises to reduce the costs of developing and deploying blockchain applications,” Xie added.
The Hangzhou-headquartered Nervos was founded in 2018 by a team of blockchain and crypto veterans from the Ethereum Foundation, imToken, and Yunbi (云币).
“There’s no shortage of blockchain projects but Nervos stands out because it has a clear mission and a well-defined plan to bring tangible and immediate benefits to the most promising segment of blockchain users,” Steven Ji, Partner at Sequoia China, said in a statement.