China bets heavily on metaverse as Zhengzhou joins with $8.5 billion fund
- Zhengzhou City has announced a strategic plan for the metaverse industry.
- The provincial capital of Henan plans to set up a 10 billion yuan (about US$1.4 billion) fund, with another 50 billion yuan (about US$7.08 billion) planned.
- The plan also stipulates that the Zhengzhou municipal government will provide further incentives for Metaverse companies to establish themselves in the city.
China’s big bet on the metaverse continues to take shape, and another major city is backing the idea. The city of Zhengzhou, capital of Henan province, on Wednesday announced a strategic plan to support Metaverse companies operating in its jurisdiction.
According to the announcement, the Zhengzhou municipal government also plans to offer incentives to attract more metaverse companies to settle in the city.
The government plans to set up a 10 billion yuan (about US$1.4 billion) fund for the metaverse industry. Zhengzhou also plans to work with other government agencies to expand the fund to support Metaverse-related projects to a whopping 60 billion yuan (~$8.48 billion).
According to the report, Metaverse companies that relocate their headquarters to the capital, Henan, will receive up to 200 million yuan (~$28.34 million) in seed capital. Other government incentives include rent subsidies and cash rewards for Metaverse companies listed on China’s major stock exchanges. Forkast News reported.
Metaverse companies already established in the city are also eligible for up to 5 million yuan (US$710,000) for each Metaverse project deemed beneficial to the city government.
The fund is provided in particular for research projects related to virtual reality (VR), augmented reality (AR) and brain-computer interfaces. There are also big plans for projects that want to explore opportunities in education, commerce and entertainment.
Although some publishers continue to dismiss the metaverse, calling it a dead dreamChina seems to have ambitious plans for the industry. Zhengzhou expects the metaverse to achieve annual sales of up to 200 billion yuan (US$28.34 billion) by the end of 2025.
China has banned open-source public blockchains in the country and instead encourages companies built on top of the blockchain to use them Blockchain Service Network (BSN) introduced in 2022. And that despite China’s restrictions non-fungible tokens (NFTs)Zhengzhou also plans to develop a digital asset market based on NFT technology.
Zhengzhou joins a growing list of Chinese cities that have announced ambitious Metaverse plans, most recently Nanjing. The Chinese capital Shanghai is also launching its own 10 billion yuan (~$1.4 billion) Metaverse fund by July 2023 and expects the Metaverse industry to generate revenue of up to 350.000 by the end of 2025 will generate billions of yuan.
China’s restrictive technology policies have made it difficult for companies to benefit from the metaverse. Tencent was recently forced to do this is scrapping its XR divisionand laid off 100 employees barely four months after assembling the team.
Baidu’s Head of Metaverse Operations, Ma Jie also quit his job after the Chinese internet giant apparently ditched its Metaverse division to focus on generative AI.
Zhengzhou and Shanhai’s massive Metaverse funds could give companies a new reason to keep exploring opportunities in the 3D immersive world.
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