Blockchain-related financing was most active in China and the US in 2019, which together accounted for roughly 60% of total deals in the industry according to a report published Thursday.
Why it matters: Global blockchain financing trends last year were heavily influenced by major events in China and a shift in sentiment from the country’s regulators.
Details: Globally, 653 blockchain-related financing deals took place last year, with approximately $4.7 billion flowing into the nascent yet volatile market, according to the report by media and consultancy firm PANews.
- There were a total of 191 financing deals in China accounting for more than $1.15 billion of investment into blockchain-related businesses. The Bohai Sea region surrounding Chinese capital Beijing in particular attracted the most funding with 96 deals completed last year. Beijing topped the chart with the highest number of deals and overall financing size.
- The US followed closely behind China with 181 deals during the year.
- In Singapore there were 47, in India there were 19, nine in Korea, and Japan saw three blockchain-related deals in 2019.
- After October, however, Chinese regulators tightened scrutiny of the industry, specifically targeting digital currency exchanges. This curbed the surge of capital into the sector and created a financing freeze in the fourth quarter of 2019, according to the report.
- Exchanges had been considered a money magnet, and the companies running them gained momentum once the Chinese central bank indicated that it was ramping up the development of its own planned digital currency in the second half of 2019.
Context: Chinese President Xi Jinping remarked on the significance of blockchain development in October, which immediately prompted a slew of companies to enter the space, and boosted bitcoin. However, the flurry of activity led to a crackdown on blockchain-related illegal and fraud activities.
- The Chinese government has been rolling out favorable policies to attract businesses and talent to hubs across the country. A recent study named the circum-Bohai Sea region, Yangtze Delta region, the Hunan-Guizhou-Chongqing zone, and Pearl River Delta region as the four main blockchain hubs.
Updated: included the number of US deals during the year.