Alibaba’s Cryptic Relationship With Bitcoin and Blockchain

Since Bitcoin’s uses started to be thrashed out in forums and around dinner tables alike, there was always the belief that it would be a perfect thing for the likes of Amazon to accept. Digital cash for a digital store.

Amazon may well be getting into the blockchain game, albeit slowly, and not with Bitcoin. But what about Alibaba? Alibaba is in the East, what Amazon is in the West, and is a massive eCommerce business with huge sway and power in the tech market.

So, if Amazon’s Bitcoin, blockchain and cryptocurrency journey is pretty much mapped out and accounted for, what is the deal with Alibaba, and where do they stand on this revolutionary technology, this new form of money, and this popular digital cash?

Extended reach

Alibaba is much more than just an eCommerce site for the East. It is a holding company with 13 subsidiaries — from the main eCommerce site to a football team in Guangzhou — and over 66,000 employees.

It is obviously also a very tech-forward company, being a successful eCommerce business first, and being co-founded by Jack Ma — one of China’s richest men with a net worth of $42.7 billion — it is also a company with a lot of clout.

So, with the likes of Amazon, Microsoft, IBM, Oracle and other heavy-hitting, Western technology companies all scrambling to make sense of blockchain and cryptocurrencies with their own projects, it is interesting to look into Alibaba’s vault and see what they have been doing with the technology.

It won’t be easy to find Alibaba’s hands directly linked to Bitcoin like, for instance, in the way that many maybe would hope to see; the eCommerce store suddenly started accepting Bitcoin, but — delving deeper into the subsidiaries — there is evidence of Alibaba experimenting with blockchain itself.

Blockchain remittances

Recently, it was reported that Alibaba subsidiary Ant Financial has trialled its first blockchain remittances, sending a transaction in three seconds.

This trial saw the company completed a funds transfer between its AliPayHK app in Hong Kong and Filipino payment app GCash — its joint project with local telecoms company Globe Telecom.

Jack Ma was on hand to explain the importance of this trial and why he and Ant Financial — and thus Alibaba Holdings — thought cross-border remittance is vital, and how blockchain is a big game changer.

“Using blockchain to achieve cross-border remittances is one of my most concerned projects in the past six months. Starting from Hong Kong, this service [AlipayHK] will be brought to the rest of the world in the future.”

Clearly, Ma sees the value of blockchain technology, especially in finance. In fact, he goes on to give an even bigger insight into how blockchain and finance can help the world.

“Blockchain should not be a tech to get rich overnight. There are still 1.7 billion people in the world who have no bank accounts, but most of them have mobile phones. The impact of blockchain on the future of humans may be far beyond our imagination.”

Blockchain in healthcare

There is more evidence of Ma, and Alibaba getting its hands near — but never directly on — blockchain and cryptocurrency technology when  ZhongAn Tech announced its plans to use blockchain technology to cut risk and costs in healthcare insurance

ZhongAn, the technology incubator for ZhongAn Online Property & Casualty Insurance, was founded in 2013 by the chairman of Alibaba Group, Ma. This use of blockchain in such a space also tied in with Ma’s general thoughts on blockchain being effective for addressing privacy and security issues across all industry sectors.

Pursuing more blockchain

Furthermore, Alipay’s operator Ant Financial, a long-term subsidiary of Alibaba Group Holding, has entered into “definitive agreements” with investors to secure $14 billion in a ‘Series C’ equity financing round. The money will be spent to pursue blockchain and technological innovation.

Ant Financial’s CEO Eric Jing has said that he “definitely” expected to see blockchain becoming “deeply” implemented into Alipay in future, eventually acting as a base protocol for the popular mobile payment application.

This financial arm of Alibaba also recruited blockchain experts to actively look into the potential of blockchain technology through 2017 and surely has been building up a big base of knowledge and information on the technology.

It is more evidence of the companies in and around the conglomerate of Alibaba seeing huge worth in blockchain and financial services along with the technology. But it did not start here.

All the way back in August 2016, Alibaba introduction of tamper-proof blockchain technology to improve accountability in the Chinese charity industry. This was Ma’s first foray into blockchain technology, and — as the philanthropist has probably learnt along the way — there is a lot still that can, and should, be done with it…

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