Two exhibition booths stood out at the Staking Summit in Istanbul, a conference attended by hundreds of individuals involved in staking practices in the cryptocurrency ecosystem. They belonged to Tencent and Huawei. In a backdrop dominated by people in their 20s wearing trendy corporate hoodies and handing out well-designed merchandise, China’s two tech giants feel a little out of place under the more formal corporate flag. It looked like there was.

Next to them were engineers, marketers, and business developers deeply into staking, where individuals pledge crypto assets like Ethereum to protocols in exchange for a return. The borrowed assets are then used to verify transactions within the blockchain, which implements a “proof-of-stake” method.

Over the past year, several Chinese tech giants, including Alibaba, Tencent, and Huawei, have appeared at crypto events around the world. Hoping to carve market share in the nascent Web3 space, they appear at these events with a more low-profile presence, either as official sponsors or simply as participants.

The Chinese tech giant’s participation in crypto falls somewhere at the intersection of Web 2 and Web 3, thanks to a widespread ban on crypto trading and initial coin offerings in its home country. In the most common case, these technology companies are selling their computing resources to his Web3 startups in a manner not too different from how they have sold cloud services to more established technology industry companies. Masu.

Cloud costs for companies building or leveraging decentralized networks are still understood to be negligible. While it’s not uncommon for Web2 “midsize” companies to spend $1 million or more on cloud computing, companies that qualify as Web3 midsize may only spend in the low hundreds of thousands of dollars, the speakers said. said several participants at the meeting. said the event.

However, the limited ticket size does not prevent Chinese cloud providers from venturing into cryptocurrencies. Chinese companies, the underdogs in the global cloud market, have less brand recognition, especially in the West, and are far more proactive and flexible with their customers. Therefore, companies must compete by offering cheaper or better services.

In addition to providing cloud infrastructure, Chinese companies are moving into areas outside of their core products, exposing them to competition from crypto-native companies. This includes building blockchain for enterprises. Most Chinese tech companies have stayed away from the public blockchain space, where tokens play a key role, due to the country’s cryptocurrency crackdown.

Some players also offer node-as-a-service business. A blockchain is a decentralized database that stores and encrypts transaction data and runs on distributed nodes.However, these nodes are expensive and complex to maintain, making companies like Huawei Provide node hosting services for developersis an attractive solution for companies that want to build decentralized applications but lack the technical sophistication to do so in-house.

Tencent and Alibaba were the first Chinese technology giants to enter the Web3 space and have also worked on high-profile projects to improve their reputation in the industry.

For example, Tencent has partnered with public blockchains such as Sui and Avalanche, as well as Ethereum scaling solution Scroll.

Meanwhile, Alibaba partnered with Aptos, a blockchain developed by a former Meta employee, to make its name known in the world of Web3. In a joint announcement today, Alibaba Cloud and Aptos Foundation announced that they will jointly host a hackathon using the Move programming language in the Asia Pacific region.

So far, Web3 is barely making inroads into the revenue of China’s technology giants, but these companies recognize the potential of a rapidly growing industry and are willing to take advantage of significant market swings and financial system collapse. Even in the face of it, we understand that we cannot afford to miss this opportunity. Major companies such as FTX.