Imagine a country with an army of techies, a government that supports AI and blockchain by setting a mandate and investing billions, large scale tech companies that are rapidly experimenting and implementing at scale, and an abundance of data to feed the application of these technologies. This just about covers the AI and blockchain playground that is China. The gloves are off, and over the coming years some of the greatest advancements will emanate from the east. Here’s why.
An ambitious AI strategic plan was laid by the China’s State Council in July 2017, aiming to create a domestic 1 trillion yuan ($150 billion) AI industry by 2030. Following this, Chinese president Xi Jinping called upon his country to take the lead in developing new technologies like artificial intelligence, the internet of things, and blockchain. Last year alone China’s AI sector received $28 billion in investment, and that level of investment is set to continue as all of the tech giants and banks are actively investing and up-skilling their capabilities. For example Baidu is betting big on developing smart home speakers, translation software, and self-driving cars. E-commerce giant JD.com has established a Smart City Research Institute that aims to facilitate the development of ‘Smart City’ construction with the use of AI, big data, and blockchain technologies. Another example is SenseTime, which received $1 billion in investment from Alibaba to focus on facial and image recognition through combining computer vision and deep learning.
But how much of this work is really new and ground-breaking? A recent study produced by Startup Genome analyzed all of the patents in AI and concluded that China now ranks as No.1 in the world. The country has exhibited widespread experimentation, coordination, and application of AI across multiple industries. Factor in the concept of ‘cross pollination of technologies’ such as mixing AI with blockchain, IoT, or even cloud, and the whole is much greater than the sum of its parts.
Consider JD.com ‘Smart City’ initiative, which is leveraging AI, big data, and blockchain technologies. The company is applying blockchain tech in various aspects of its business from its logistics and supply chain to issuing blockchain asset-backed securities. In August, JD.com revealed its new Blockchain-as-a-Service (BaaS) platform. The tool, called JD Blockchain Open Platform, will purportedly enable businesses to build, host, and implement blockchain solutions without having to develop the technology from scratch.
According to Yu Jianing, Director of the Institute of Industrial Economics at the Ministry of Industry and Information Technology, over the next three years, the cutting-edge technology is expected to be widely integrated into sectors that require product traceability, copyright protection, bill verification, and precision marketing. It will also be used in the energy and healthcare industries. We’re seeing the early signs of a complete industrial chain with blockchain at its core, ranging from hardware manufacturing, platform and security services to application services, investment, media, and human resources services. As of March 2018, the number of blockchain tech companies in China exceeded 456, while there have been an estimated 249 deals related to blockchain companies. Back in 2016, just 60 funding rounds were recorded — five times more than in 2015.
