At a Shenzhen blockchain expo event hosted on Sunday by the China Electronic Commerce Association, Shenzhen’s city government revealed that it is backing a considerable blockchain investment fund.
The fund aims to invest CNY 500 million (USD 80 million) in blockchain startups in Shenzhen, which comes shortly after Hangzhou city took very similar steps toward accommodating and evolving its approaches to blockchain technology.
In early April, the city of Hangzhou began turning the cogs of its own blockchain venture capital fund dubbed the ‘Xion’An Global Blockchain Innovation Fund’; the funding project was launched by Hangzhou firm Tunlan Investment and has USD 400 million of the USD 1.6 billion available being provided by the Hangzhou city government.
The project has opened a Blockchain Industrial Park in the city, with ten blockchain projects from across the globe being “successfully contracted”. The fund, industrial park and the Zehejiang Shimang Blockchain Strategic Development Institute will all provide academic and financial support to the development of blockchain technology in Hangzhou.
This is particularly noteworthy considering that a couple of weeks earlier, a government-led investment group in China had thrown away plans to create a blockchain funding centre due to conflicts regarding regulation.
… to Shenzhen
Now in Shenzhen through a public-private partnership, 40% of the fund (USD 32 Million) will come from the Shenzhen Angel Investment Guidance Fund, that has a total of CNY 5 billion to pump into city startups; roughly 4% of that total is to be given to local blockchain projects.
The blockchain venture capital fund will be managed by Donghai and Star Capital, which are both state-owned investment firms; they will be supervised by the state-owned Assets Supervision and Administration Commission of the State Council (SASAC). In a report made by Sohu, Liu Zhongpu, local government official and commissioner of the Shenzhen advisory commission, will also be serving as an advisor to the fund.
Sohu also reports that the Chinese Academy of Sciences and the Shenzhen Institute of Innovation and Development will accrue over 100 blockchain startup projects to invest in, which will act as the incubation project for the angel fund.
China, who previously declared controversial bans on ICOs and cryptocurrency exchanges, appear to have eyes set on a bountiful blockchain future. Sun Jiangtao, an angel investor and the co-founder of Beijing-based Goopal Group, which builds blockchain-based applications, said:
“Some months ago, when equity investors had no sense of blockchain technology, we fell out of favor with start-ups,” he said. “But when the regulators got a deeper understanding of blockchain and cracked down on ICOs, VCs and big companies found back their competitiveness.”