China's web3 community is rallying around the news of Tencent's march into the decentralized land. On Wednesday, the social and gaming giant held its first global web3 summit in Singapore, which has emerged as a refuge for China's blockchain developers after Beijing cracked down on cryptocurrencies in 2021.
It's hard to overlook the timing of the event. On Monday, Hong Kong announced plans to let retail investors trade Ether and Bitcoin starting in June, a boost of confidence that China might have softened its stance on cryptocurrencies.
As we speculated, China probably won't want to miss out on what could be the next wave of technological disruption, that is, the digitization of value transfer. While its worries over crypto market volatility are valid, as seen in the chain reaction of Luna's downfall and FTX's collapse, it at least wants to experiment with caution and at arm's length.
Indeed, Bloomberg reported yesterday that Hong Kong's ambition to become a crypto hub had "quiet backing" from Chinese officials.
Support at the top might have emboldened Tencent to host a high-profile web3 event. The firm has dabbled in web3 previously, but it was treading much more carefully. Its domestic projects were largely limited to government-approved efforts, including building a consortium blockchain with corporate partners, in contrast to a global, permissionless one like Ethereum.
Like its peers, Tencent branded its NFT platform as a "digital collectible" marketplace and prohibited secondary trading after China warned of speculation around non-fungible tokens. Huanhe, its digital collectible platform, shut down only a year after launching. Outside China, the company tried to have some skin in the web3 game through financial investments. It backed Australia's web3 gaming firm Immutable, for example.
Tencent's foray into web3 seems more confident and tangible this time around. At the conference, the firm's cloud computing arm, Tencent Cloud, revealed that it has signed a Memorandum of Understanding with Ankr, a web3 infrastructure provider, to jointly develop a suite of blockchain API services. That means Tencent has officially joined the race with cloud providers like AWS to attract web3 developers.
Tencent Cloud is also partnering with a few other popular web3 infrastructure builders, including Avalanche, a blockchain that focuses on speed and low transaction fees; Scroll, a Layer 2 scaling solution for Ethereum; and Sui, a relatively young Layer 1 blockchain created by ex-Meta employees. It's an exciting time ahead for Hong Kong and all the Chinese web3 developers that want to be closer to home.