China's Biggest Blockchain Backer Launches Startup Accelerator

A blockchain venture backed by Chinese conglomerate Wanxiang Group has launched a new startup accelerator.

The kick-off, which formally took place on 22nd February, comes soon after Wanxiang pledged to spend as much as $30bn on a smart cities initiative, set to be invested over a seven-year period. As part of that plan, Wanxiang, best known as the country's biggest makers of automotive parts, said it would look to fund blockchain entrepreneurs.

As a continuation of that plan, China’s first dedicated blockchain accelerator – dubbed the 'Chainbase Accelerator' –  will initially launch with four startups under its wing.

During the launch event in the Hongkou District of Shanghai, Feng Xiao, vice president and executive director of China Wanxiang Holdings – the group’s financial arm – invoked its smart city initiative once again, stating that the conglomerate sees a role for blockchain in the areas of next-generation energy delivery, digital currency and smart governance.

The executive told attendees:

During their time within the accelerator, the startups will work directly with Wanxiang staff, focusing on product iteration and business-model development, representatives of the company said. Further, Wanxiang’s cloud-based blockchain platform, WanCloud, will be utilized as part of the initiative.

The Wanxiang-backed blockchain venture was first revealed in September 2015, as part of a broader plan to invest as much as $50m in venture capital in the space.

The initial group of startups chosen for the Chainbase Accelerator reflect the group's push toward the deep integration of technology in a 21st-century urban concept.

Dorling Abby, for example, is a startup that, like others in the blockchain space, is looking to leverage the technology to create smart devices managed by asset-controlled smart contracts. Specifically, Dorling Abby wants to deploy smart contracts to manage domestic locks, enabling the creation of an on-demand rental economy.

Yuanben, by comparison, is looking to develop a blockchain-based trading platform for copyright. According to Wanxiang, the startup’s platform aims to record cryptographic signatures tied to copyrighted content, with that information being published on a distributed ledger.

The third startup, Bianjie Intelligence, is hoping to create a delivery vehicle for medical information, leveraging blockchain technology to handle the exchange of that data. The startup is said to be founded by Heng Cao, a former big data expert for IBM's Global Research Institution.

And, finally, Moceng aims to deploy the tech in the gaming space, using blockchain as a means to catalog download and registration counts, as well as payment histories, for games. The startup further indicated that plans to create real-time payment mechanisms for game purchases.

During his speech, Xiao pledged that, in the coming months, Wanxiang would begin to divulge how it intends to build its smart city.

“We aim to build the nine square kilometer [city] into a global innovative platform of business endeavors. In one or two months, we will release some application demands regarding the innovative new energy city,” he said.

Among the applications Xiao invoked in his speech are smart products that feed information into a wider Internet of Things, which Wanxiang sees as a key aspect of its smart city plan. Blockchain, according to Xiao, could provide an essential means of establishing the identity of a particular device and its owner.

“How to manage the identities of these devices? How to ensure that certain data was originated from Mr Zhang’s refrigerator rather than that of Mr Li? In this case, blockchain may be a perfect solution,” he said.

His comments come during a significant period for blockchain in China. Amidst a rise in domestically based startups working with the tech, China’s central bank itself is experimenting with the concept of a central bank-issued digital currency, reflecting work taking place at other central banks around the world.

At the same time, the People’s Bank of China has boosted its scrutiny of the country’s bitcoin exchange ecosystem, a move that resulted in a shift in policy at Chinese exchanges and a broader sea-change in the global market.

For now, at least, Wanxiang has struck a bullish tone on its plans, and as part of of that process, Xiao indicated, the conglomerate’s blockchain wing will look to work with entrepreneurs in the space.

“We will be reaching out to global talents with technology, ideas and conviction, to pursue their business endeavors on our platform,” Xiao concluded.