Quartz recently released a reported on how the bitcoin market in China has grown from a small-scale experiment to a billion-dollar market. The author reported that the Chinese government regulates the market so tightly that there is little room for speculation.
This tight grasp over the market leads to limited investments that may not be as profitable as the investors would like them to be. Bitcoin was formed at the same time that the class of investors in China were growing and looking for investments with better return. Regarding bitcoin as an investment, Martin Chorzempa, a research fellow at the Peterson Institute of for International Economics in Washington DC, states:
"[Chinese consumers] have had such limited channels for so long, and [bitcoin] was finally one that was not tightly controlled by the government."
Fears of inflation
Investors prefer bitcoin over contemporary investments, as it is unregulated and may not suffer from inflation unlike yuan. The yuan was devalued in 2015 by the Chinese government in order to boost economic activities and consequently, increased the prices of everyday products. Eric Zhao, who runs the widely followed Twitter account CN Ledger, says:
"There are not many good investment choices for common people in China. Many people worry about inflation and lots of people feel insecure about their financial status. They buy it simply because they believe it will appreciate in value."
Blockchain for industry
By combining blockchain with existing internet of things devices, firms aim to unify the fragmented data that flows through their factory floors. This will allow for faster communication and execution of processes. Such applications will be free from the regulations that are faced by financial applications which will increase the speed at which they are accomplished.
Foxconn, the world’s largest contract manufacturer of electronics and best known for manufacturing iPhones, thinks that blockchain is the future of financing, as it will allow its suppliers to easily get financing. Foxconn executive, Jack Lee, stated in a conference in New York, that if Foxconn can find a way to leverage its current data on small businesses through blockchain, then it could create a highly efficient supply chain that could also have the capability to track the delivery of goods.
Blockchain could allow the companies to skip the old-fashioned financial service models and allow them to move towards safe, efficient method of mobile financing. Companies such Ali Baba and Tencent are already procession trillions of dollars worth of transactions through their mobile payment services. By developing a blockchain product for this service, the firm would gain an edge over their competitors.