Ant Group Ends $100 Million Investment in A&T Capital’s Blockchain Fund
Ant Group, a Chinese fintech company, is discontinuing its $100 million investment in A&T Capital’s blockchain fund due to an investigation into one of the fund’s founders. The purpose of the investment was to expand Ant Group’s presence in digital assets.
The co-founder of A&T Capital, Yu Jun, resigned after the company initiated an investigation into his conduct several months ago. Prior to joining A&T, Yu Jun assisted Ant Group in investing in offshore cryptocurrency products.
Ant Group Prioritizes AI Over Blockchain Ventures
In 2022, A&T raised $100 million for investments in crypto and blockchain. It allocated $19 million to prominent crypto companies such as Amber Group, MatrixPort, and ConsenSys, an Ethereum infrastructure developer.
Reports on the future of A&T Capital remain uncertain amid a decline in crypto venture capital investment and a shift towards artificial intelligence (AI). This change reflects the evolving interests of Jack Ma, the backer of Ant Group, following Alibaba’s launch of its own large-language model bot.
China is heavily investing in AI to compete with the US and has regulations that prohibit non-socialist data usage in AI algorithms.
China’s Emphasis on Digital Currency Diminishes Fintech Blockchain Interest
The dominance of renminbi-based fintech services like Alipay and WeChat Pay may deter Ant Group from further blockchain investments. Shanghai ranks second globally as a fintech hub according to Z/Yen Global Financial Crimes Index 30 Report.
In addition, China has largely transitioned to a cashless economy. The country also participated in a summit discussing the possibility of a common digital currency for the economies of Brazil, Russia, India, China, and South Africa (BRICS).
The arrest of Chinese officials involved in supporting the banned crypto industry adds to the investment risk. Earlier this year, influential officials suggested that Hong Kong was being used by China to gain insights into the workings of the crypto industry.
Hot Take: Ant Group Shifts Focus Away from Blockchain Investments
Ant Group’s decision to wind down its investment in A&T Capital’s blockchain fund highlights its shifting priorities towards AI and digital currency. The investigation into one of the fund’s founders likely influenced this move. With China heavily investing in AI and experiencing a decline in crypto venture capital, Ant Group is aligning its interests with these market trends. Additionally, the dominance of renminbi-based fintech services and the country’s cashless economy diminish the appeal of further blockchain investments. Overall, this strategic shift reflects a broader trend in China’s fintech landscape.
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