Tencent Cloud, which once resolutely "does not involve coins", extends its business to "blockchain with coins". At the first Web3 Global Summit "Tencent Cloud Web3 Build Day", Tencent Cloud announced its foray into Web3 and unveiled its cooperation with Ankr, Avalanche, Scroll and Sui four original blockchain projects, the first two of which have issued cryptocurrencies. The latter two issues in the currency circle people also seem to be "only a matter of time."

Tencent Cloud, which once resolutely "does not involve coins", extends its business to "blockchain with coins".

At the first Web3 Global Summit "Tencent Cloud Web3 Build Day", Tencent Cloud announced its foray into Web3 and unveiled its cooperation with Ankr, Avalanche, Scroll and Sui four original blockchain projects, the first two of which have issued cryptocurrencies. The latter two issues in the currency circle people also seem to be "only a matter of time."

It is worth noting that in June 2021, Tencent Cloud issued a statement explicitly prohibiting customers from using Tencent Cloud services for any virtual currency-related activities. Today's Tencent cloud position has changed.

Tencent Cloud's change of attitude may be related to Hong Kong's recent deregulation of cryptocurrencies. In addition, Tencent Cloud, which has not made a profit for 12 years, is also under great revenue pressure. It has become a new option from Web3.

1. "Coin" blockchain appears in Tencent Cloud customers

On February 22nd, the first Web3 Global Summit "Tencent Cloud Web3 Construction Day" was held in Singapore. At the event, many native blockchain projects were present, including Ankr, the Web3 infrastructure platform, and Ava Labs, which led the public chain project Avalanche.

Tencent Cloud has a straightforward theme for its Web3 Build Day -- accelerating Web3's success. As one of the "four clouds" in China, Tencent Cloud announced its support for the development of the global Web3 ecosystem, and announced its development roadmap, including the launch of a full set of blockchain products, blockchain API services and a one-stop solution named "Metaverse in-a-box".

Blockchain has long been seen as the infrastructure of Web3. Yang Baoshu, senior vice president of Tencent Cloud International, said Tencent Cloud sees the future of Web3, which is a new iteration of the Internet and introduces the concept of "immersive integration", where the physical economy and digital economy meet and merge. Therefore, with the increasing adoption of Web3 and other decentralized technologies, a paradigm shift in the use-case approach is required.

Yang's "use case approach" refers to the cloud services underlying blockchain applications. If blockchain projects want to operate and grow healthily, they not only need the support of powerful cloud servers, but also need dedicated intelligent clouds to provide convenient components for developers to build applications.

At the beginning of its push into Web3, Tencent Cloud had already secured four major partners, including Ankr, Avalanche, Scroll and Sui. These are well-known projects in the crypto industry. Ankr and Avalanche have been deployed for some time, with the release of on-chain tokens ANKR and AVAX, respectively. While Scroll is a newly developed layer 2 expansion solution project of Ethereum, Sui is a new generation of public chain developed with Move language. The main network of these two projects has not been officially launched yet, but according to people in the coin circle, "it is only a matter of time for these two projects to issue coins".

The cooperation between Ankr and Tencent Cloud mainly includes the development of a set of blockchain API services to provide a globally distributed and decentralized remote call node network; Avalanche has built fully synchronized on-chain nodes on Tencent Cloud to provide developers with fast and efficient node setup. Scroll will cooperate with Tencent Cloud to develop blockchain extension solutions; Sui used Tencent Cloud to focus on optimizing high-performance games, specifically supporting the infrastructure needs of Web3 game developers.

"We are ready to leverage our years of technical experience in gaming, audio and video to provide strong technical support for Web3 and work with industry partners to create more immersive experiences and foster a better Web3 ecosystem," said Yang Baohu.

One of the big announcements at the summit was Tencent Cloud Metaverse in-a-Box. True to its name, this solution is primarily for on-chain metaverse development and features high performance, comprehensive infrastructure and low code solutions for gaming, media and entertainment application development and deployment. Tommy Li, vice-president of Tencent Cloud, describes it as a means of accelerating users' journey towards the metacomverse.

2. Go to the deep water of blockchain

In the Internet era, the establishment of any application is inseparable from cloud services. Cloud market also from the initial general cloud, gradually refined to adapt to all walks of life proprietary cloud.

As can be seen from the official website of Tencent Cloud, its current cloud services cover finance, medical care, games, culture and tourism, education, manufacturing and other industries and scenes. In the field of blockchain, it also has a number of "non-coin" solutions, including digital identification, medical data flow, terminal trusted link, etc.

Tencent Cloud has deliberately avoided any involvement with virtual currencies until at least 2022, largely due to strict regulations on activities related to virtual currencies in China.

In June 2021, Tencent Cloud issued a "Statement prohibiting the use of Tencent Cloud Services for any virtual currency-related activities". The statement pointed out that according to relevant regulations, policies and requirements of regulatory authorities, Tencent Cloud prohibits customers from directly or indirectly engaging in virtual currency-related businesses or behaviors using Tencent Cloud services. Including but not limited to virtual currency exploration (mining), registration, trading, settlement, settlement, etc.

After this paper ban was issued, there have been a lot of Tencent cloud mining virtual currency projects or people reported that they received Tencent cloud issued a "cloud server suspected mining behavior self-inspection notice", requiring self-inspection and rectification as soon as possible.

Tencent Cloud, which does not involve coins but only serves "coin-free blockchain", has now made a U-turn and directly offered to Ankr, Avalanche and other coin-issuing projects. Although the cooperation between Tencent Cloud and these original currency circle projects focuses on API, node building, application optimization and other aspects, Tencent Cloud finally got involved with "currency" because the value transfer and asset transaction on the above project chain need to be completed by virtual currency.

Overseas media analysis, Tencent cloud choose at this time to open hands and feet, but also in Hong Kong policy under a test of the water. Just two days before the opening of the "Tencent Cloud Web3 Build Day", Hong Kong's Securities and Futures Commission said in a consultation paper that it would allow individual investors to trade large-cap tokens on SFC licensed trading platforms. This message is widely seen as a major positive policy for the acceptance of cryptocurrencies in Hong Kong, and to some extent signifies the selective liberalization of local regulation on the crypto economy.

Although you are one of the "four clouds" in China, Tencent Cloud has always been overpowered by Alibaba Cloud, bearing the pressure of revenue and growth.

After 12 years in the cloud business, Tencent Cloud has yet to turn a profit. In 2022, revenue growth in Tencent's fintech and enterprise services segment plunged from 30% to 4.6%, dragged down by cloud business, and Tencent Cloud's market share was overtaken by late comer Huawei Cloud, ranking third in China. Inside Tencent, senior executives have shouted that the company needs to optimize its loss-making businesses, reduce costs and increase efficiency to maintain healthier growth.

This time, Tencent cloud service original blockchain project, no doubt conducive to the search for business growth point in Web3 field. The cryptocurrency community, known for its "wealth effect," is indeed a gold mine for cloud providers. Amazon Cloud has been secretly serving Chinese coin enterprises and generating considerable revenue, "according to an employee of Amazon China, a large crypto asset exchange in China has been spending one to two hundred thousand US dollars on Amazon Cloud every month."

Of course, for now, Tencent Cloud has continued its usual caution. Most of the four publicly announced clients are overseas projects. In addition, Tencent Cloud does not yet provide services to crypto exchanges with higher regulatory risks.

Market Research Future estimates that the Web3 blockchain sector will be worth more than $6 trillion in 2023, and the size of the Web3 market will continue to grow at a compound annual growth rate of 44.6% from 2023 to 2030. In the face of this big cake, Tencent cloud picked up the "shovel" of the nuggets.

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