Chinese Billionaire Bitcoin Investor ‘Done’ Investing in Blockchain Projects
Li Xiaolai, the founder of Beijing-based venture capital firm BitFund and a widely recognized billionaire Bitcoin investor in China, has publicly stated that he will personally move away from the blockchain and initial coin offering (ICO) space. He said on China’s largest social media platform Weibo: “From this day on, Li Xiaolai personally will not invest in any projects (whether it is blockchain or early stage). So, if you see ‘Li Xiaolai’ associated with any project (I have been associated with countless projects without my knowledge, 99% is not an exaggeration), just ignore it. I plan to spend several years to contemplate on my career change. As for what I’m doing next, I’m not sure just yet.” The cryptocurrency market has experienced its fourth worst correction in the past nine years, experiencing a 80 percent drop in valuation within the past nine months. Yet, the vast majority of ICO and blockchain projects have held most of their holdings in Ethereum and Bitcoin throughout the bear market and the ICO market still remains active to this day.
The decision of Li to abruptly exit the ICO and blockchain sector was likely fueled by two major factors: the crackdown on ICOs by the Chinese government and a significant increase in the number of scams in the blockchain market. In June, CCTV, China Central Television, a state-owned network controlled by the government, released a documentary on blockchain and claimed that the technology has the potential to achieve a level of success that is in orders of magnitude larger than that of the Internet. The statement released by CCTV came as a surprise to both the local cryptocurrency market of China and the global finance industry, especially given the ties of CCTV with the government. “Blockchain is the second era of the Internet. The value of blockchain is 10 times that of the Internet. Blockchain is the machine that produces trust,” CCTV reported.