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“In the coming year, the capital market must be the world of blockchain.”
This is a prediction made by a blockchain practitioner on the industry after the 1024 speech, and it also revealed the beautiful vision of many blockchain practitioners about the future at that time.
After a year, how has the blockchain developed in China? Compared with the expectations at that time, how is the reality different? As an observer of the blockchain industry, with these questions, 01 blockchain had an in-depth dialogue with the founders of blockchain companies and industry experts.
Blockchain One Year: “Busy” 365 days
October 24, 2019, may be a crucial day for Chinese blockchain practitioners.
On this day, the Political Bureau of the Communist Party of China Central Committee conducted the 18th collective study on the development status and trends of blockchain technology. When presiding over the study, Xi Jinping, General Secretary of the CPC Central Committee, emphasized that the integrated application of blockchain technology plays an important role in new technological innovation and industrial transformation. We must take the blockchain as an important breakthrough in the independent innovation of core technologies, clarify the main direction, increase investment, focus on a number of key core technologies, and accelerate the development of blockchain technology and industrial innovation.
The speech of General Secretary Xi made the blockchain industry, which had been silent for a long time because of the market, cheered. The front page headlines of the People’s Daily, the nearly 6-minute special report of the news broadcast, and the competing reports of major mainstream media have all made the blockchain gain unprecedented attention.
On the day of the 1024 speech, the blockchain industry began a “busy” year.
This year, local governments are very busy.
Before 2019, only a handful of cities such as Guangzhou, Hangzhou, Beijing, and Guiyang are deploying blockchains, and more regions are still focusing on the financial technology fields with higher attention such as big data and artificial intelligence. However, after the 1024 speech, the blockchain became the “wind outlet” of the whole people’s attention. Local governments immediately started learning about blockchain technology, and began to formulate and intensively publish blockchain policies.
According to the “China Blockchain Policy Census Report (2019)” released by 01 Blockchain at the end of last year, as of December 2019, a total of 32 provinces and cities across the country have issued blockchain-related documents, of which there were in November 2019 At least 16 provinces have introduced blockchain-related policies.
By 2020, local governments will further increase their policy support for blockchain. With the inclusion of the blockchain, cloud computing, 5G communications, artificial intelligence and other technologies in the development of new infrastructure in April this year, the status of the blockchain has become more prominent. Since May, in the new infrastructure action plans issued by Beijing, Shenzhen, Guangzhou, Chongqing and other provinces and cities, blockchain has occupied a key position.
According to incomplete statistics from the Securities Daily, in the first half of 2020 alone, at least 11 provinces and cities across the country have introduced special blockchain policies to guide the development of the local blockchain industry. These include not only the “vanguards” with a solid foundation in the blockchain industry such as Beijing, Shanghai and Guangzhou, but also some relatively underdeveloped “latecomers” who hope to use the blockchain to drive the development of the digital economy.
“Building a blockchain in a second- and third-tier city has no benchmarking, no burden, and greater room for fault tolerance. Although the conditions are more difficult, there is a rush.” A blockchain practitioner who has been rooted in Ganzhou for three years is interviewing Babbitt When I said so.
Policy is always a catalyst for the development of emerging industries such as blockchain. With official rectification and support, the industrial blockchain has undisputedly become the main theme of 2020.
This year, industry giants are very busy.
Giants such as Ant, Tencent, and JD.com have all accelerated the pace of blockchain deployment: Ant Group regards blockchain as the core technology for future development, and upgrades the blockchain brand to “Ant Chain”. In its prospectus, “zone The term “blockchain” has been repeated more than 130 times; Tencent hopes to promote mutual trust through blockchain and let the blockchain fully embrace the industrial Internet. Since 2015, Tencent blockchain has been used in electronic invoices, supply chain finance, and bank notes. , Judicial deposits, and other aspects; JD Digital also regards blockchain as one of its four core capabilities. Starting from the second half of 2019, it has begun to provide customers with blockchain-related services and supply Chain traceability is the source, and gradually develop efforts in the fields of supply chain finance and digital finance.
This year, block technology companies are also very busy.
In addition to the giant layout, a large number of blockchain technology companies have also made strides this year. Before 1024 speech, the author visited several blockchain companies and found that everyone was “struggling” at the time: some had to lay off nearly 50% of their staff, and some who “seeking” cooperation everywhere were often regarded as pyramid schemes and liars. Leave the industry without seeing hope.
Within a few days after 1024, the situation was completely different: many investors and companies that had previously “begged” for cooperation came to their door, and the progress of existing cooperation projects has also been significantly accelerated; Many people also look forward to understanding and entering this promising new field.
Despite the impact of the new crown pneumonia epidemic at the beginning of the year, the actual impact on blockchain companies was not as great as expected. “The company has steadily improved its receivables and technical capabilities. Recently, it has also completed a series A financing jointly invested by the Greater Bay Area Common Home Fund, CMB International, and Nihao Now. We are now focusing on finance, energy and government affairs. The application practice of blockchain.” Xita Technology CEO Wang Xiaoliang said to 01 blockchain when talking about the transformation of the company in the past year.
Zhou Miao, CEO of blockchain service provider Chain Square, which focuses on the financial sector, also said, “Although business was slow to advance in the first half of the year due to the epidemic, the epidemic also made financial institutions realize that online and digitalization are not options now. It is a necessary option. The number of companies with the intention of cooperation has increased significantly. Therefore, the completion of the company’s annual plan has not been greatly affected.”
Under the industry boom, the degree of attention attracted by the blockchain has also remained high. In addition to blockchain media, the frequency of reporting on blockchain and digital currency by traditional mainstream media has also risen sharply. The Baidu search index shows that since 2020, the search popularity of blockchain is slightly better than artificial intelligence, far surpassing big data and cloud computing.
Scenarios are hard to find, policies are converged, and talents are hard to find. The blockchain industry is waiting
In this busy year, compared to other technologies, the blockchain seems to be the best, but only those who are deeply involved in the industry know that the blockchain industry is no longer as bad as it was before, but it is far from the outside world’s imagination. so good.
Technology will evolve in exploration and application, but there are still many pressing problems ahead of technology.
For blockchain companies, especially start-up blockchain technology companies, building a “**chain” is not a problem, but how to find more matching scenarios and sustainable business models. The scene is the soil for the development of blockchain. In the absence of scenarios, blockchain is a technology without roots, and the so-called business model and commercial value are even more empty talk. However, what we can see in 2020 is that there are few innovation scenarios for blockchain applications, and familiar fields such as supply chain finance, traceability, deposit certificates, and bills are still the most common.
Of course, under the promotion of local governments, the field of government affairs seems to be another force of the blockchain industry in 2020. Before 1024 speech, most governments had very limited recognition and acceptance of blockchain, and believed that even if blockchain technology is useful, it should be used more in enterprises. But after the 1024 speech, General Secretary Xi’s speech prompted local governments to start exploring the application of blockchain in the field of government affairs. Nowadays, many local governments, including Beijing, Hangzhou, and Xiongan, are actively promoting government affairs on the chain to improve government management and service capabilities, coordination among government departments, and government data management and data analysis and decision-making capabilities. The To G business has therefore become a new revenue growth point for many blockchain companies.
Even so, the government blockchain lacks reasonable business model support. When asked how blockchain can build a sustainable business model in the government system, it is difficult for anyone to give an answer immediately. Everything is in the early stage. Many government departments may not fully understand the real demand for the blockchain, but are forced to do it. Similarly, the government affairs scene is diversified, how to choose the blockchain and government affairs scene Combining points, really hitting the point, and giving play to the actual value of technology is also a difficult problem for blockchain technology companies.
In addition to the problems of scenarios and business models, the homogeneity of support policies is also serious in the blockchain field. For local governments, GDP is one of the main assessment targets. “A lot of government workers are concerned about the actual benefits that the introduction of blockchain projects can bring to us.” Many industry insiders mentioned similar issues to 01 blockchain. But in fact, as an underlying basic technology, blockchain is still in the early stages of development, and it is difficult to independently generate direct economic benefits. Compared with the introduction of traditional industries such as manufacturing, the social dividend that blockchain can bring is not immediate.
This situation has led to the fact that although many special policies are issued underground, they are basically the same, and there are not many that really fit the local reality and the blockchain industry. “In many places where blockchain policies are formulated, they may not have a clear idea of how to develop the blockchain, and they have not really understood the blockchain,” said a blockchain practitioner for many years.
Continuous investment in technology, coupled with an unclear business model, makes most blockchain companies currently in the stage of making ends meet. The aforementioned practitioners pointed out that if local governments only decide on preferential policies based on the actual registered capital and tax payment of the company, it will have no practical significance for many blockchain start-ups.
“Policies have a positive role in promoting industrial development, but in the final analysis, it depends on whether the company has a reasonable business model, and with the assistance of policies, it may have a better boosting effect,” Wang Xiaoliang believes, “Although we see at the policy level There are many subsidies and subsidies, but on top of this, if the subsidies are turned into open projects, it will be more direct for companies to participate more in government affairs and other scenarios.”
In addition to scenarios and policies, the contradiction of talent issues is still prominent. Regarding the threshold of blockchain technology, the market has different opinions, but from the feedback of the market, blockchain talents that can match the business needs of enterprises are generally scarce.
“Like big data, artificial intelligence and other technologies, blockchain practitioners need to have strong scenario understanding and technical integration capabilities before they can solve business pain points with technical means,” said Wang Xiaoliang. Therefore, what the current blockchain companies urgently need is not pure technical developers, nor pure market operation teams, but compound talents who understand both technology and business scenarios. But this kind of talent who can match technology and business is not easy to find. Many teams have grown up with the company from scratch.
This does not mean that these people are really not found in the market at all, but the people who are available in the market are often either not technically hard, or demanding prices, or come from the currency circle and public chain, and it is difficult to be patient and steady. Earn “slow money”. “The talent problem in first-tier cities may be more severe, because talents here will have higher self-awareness and requirements, and it is often difficult to match the actual situation of blockchain startups,” Zhou Miao said bluntly.
Finance is still the point of force, and data is the core element
Blockchain technology originated from the Bitcoin system and naturally has financial attributes. In the blockchain boom in the past year, financial institutions, especially commercial banking institutions, have performed outstandingly in the blockchain field.
01 The “China Banking Industry Blockchain Application and Exploration Report (2020)” released by the Institute of Blockchain and Digital Assets in mid-20202 shows that November and December 2019 are the “acceleration of China’s banking industry blockchain practice” “Points”, the number of blockchain application practices reported and disclosed through public channels has increased significantly. Blockchain technology has become the “standard configuration” of financial technology for state-owned banks and joint-stock banks. Private banks and city commercial banks have also accelerated the promotion of blockchain technology through self-built or cooperation, and actively promoted the application of blockchain technology from point to surface. .
More intuitive data is that in 2019, the cumulative transaction value of CCB’s BCTrade2.0 blockchain trade finance platform exceeded 400 billion yuan; a cross-border financial zone led by the State Administration of Foreign Exchange and the participation of local foreign exchange administration branches and commercial banks. As of November 2019, the blockchain service platform has also completed a total of 8.214 billion U.S. dollars in accounts receivable financing, and has served nearly 1,600 companies.
In addition to the banking system, blockchain exploration in areas such as insurance and securities is also actively promoted. (See “Insurance industry, there is a high ground for blockchain applications”)
In July 2020, the China Securities Regulatory Commission issued the “Letter on Approving in Principle 5 Regional Equity Markets including Beijing, Shanghai, Jiangsu, Zhejiang and Shenzhen to Carry out Blockchain Construction Work”, which agreed in principle to Beijing, Shanghai, Zhejiang, Jiangsu and Shenzhen Participate in the pilot work of blockchain construction in other regional equity markets.
On October 21, at the “FinTech and Innovation” sub-forum of the 2020 Financial Street Forum Annual Conference, Yao Qian, director of the Science and Technology Regulatory Bureau of the China Securities Regulatory Commission, stated that at the end of July this year, the central chain of custody under the responsibility of the China Securities Regulatory Commission was initially completed. In September, the local business chains in the five pilot areas all achieved technical linkage with the central chain of custody. At present, the entire pilot work has achieved initial results. (See the article “Blockchain + Regional Equity Market: Background, Thinking and Model Exploration”)
In addition to traditional financial markets, the DeFi (Decentralized Finance, open finance) model that emerged some time ago is also worthy of attention. Based on the public chain system, DeFi uses smart contracts to automate and disintermediate transactions and businesses. It has more significant advantages in reducing intermediate links in financial transactions, lowering financial access barriers, and improving financial business transparency. Although it is still in its infancy and compliance needs to be explored, as a new technology-driven financial model, DeFi’s open, credible, and fair business philosophy and service awareness to protect user data are affecting traditional financial markets. Many institutions at home and abroad are learning to learn from the DeFi model to improve the fairness and efficiency of existing financial services.
This year, another obvious trend is that the value of data has begun to be valued. As this year’s data is officially listed as a social production factor that is as important as land, human resources, and capital, data becomes more important. However, data has many characteristics that are different from other factors of production, such as reproducibility, non-loss and timeliness, etc. This means that the method of using data elements is bound to be different from other factors of production.
The difficulty in discovering the value of data lies in data validation, pricing, and transactions. Blockchain has a lot of imagination in terms of data validation, storage, and transactions. In November 2019, the Shanghai Data Exchange Center launched a data transaction system based on the underlying technology of the blockchain. It uses the traceability and non-tampering characteristics of the blockchain to confirm and record each transaction and data, which solves the problem of Transaction accounting, clearing and settlement processing and information distribution, synchronization and storage issues in a distributed environment under the condition of transaction volume construct an open, decentralized and trusted data transaction service environment.
At the end of September 2020, the Beijing Municipal Financial Supervision and Administration Bureau and the Beijing Municipal Bureau of Economics and Information Technology issued the “Implementation Plan for the Establishment of Beijing International Big Data Exchange” and proposed that a standardized database of data products should be built, using blockchain technology, Data security sandbox, multi-party secure computing, etc., comprehensively improve the security, compliance, and confidentiality of data registration; establish data product transaction rules and business specifications, establish a data right confirmation working mechanism, form a value evaluation pricing model, and improve quotation , Inquiry, bidding, and pricing mechanisms, build an efficient transaction service process, and build a blockchain data product transaction system.
In the era of digital economy, the value of blockchain technology is bound to become increasingly prominent.
Impetuousness is still there, but pragmatism is mainstream
When entering the blockchain industry at the beginning of 2018, people are still reminiscing about the prosperity of digital currency a year ago. Although the market is down, the afterglow is especially present. Exchanges and project parties will sing and I will appear on the stage, and the chat and laugh are full of wealth and freedom. And the impetuous wind of getting rich overnight.
However, the landing of any new technology will be accompanied by a bubble, and so will the blockchain. In the early days of the industry, practitioners and those who fish in troubled waters will devote themselves to this technological change with full enthusiasm, good or bad, but after all, they are pushing the industry forward, but in different ways.
Although the impetuous wind is still present, it is not uncommon for new bottles of old wine to be tricked in the name of blockchain, but it is clearer that more industry pioneers and companies are actively trying blockchain-based technology Innovation and business applications, the pragmatic style of industrial blockchain has become the mainstream.
From the craze of digital currency to the craze of blockchain, it is the only way for the development of the industry. It is also a process for the market to remove the false and keep the truth, and return to rationality through trial and error.
The enthusiasm of the market will always dissipate, and the value of technology will eventually appear.