Why Xunlei will thrive in Blockchain 3.0

The Chinese tech giant is transitioning its business, driven by blockchain and cloud computing.

The company recently reported revenue of US$78.8 million for its first quarter in 2018, a rise of 117.9 percent on a year-on-year basis, with significant growth coming from its computing cloud business. The cloud business – based on Xunlei’s patented blockchain technology – and other internet value-added services contributed over 60 percent to Xunlei’s total revenue in that time period.

Since its establishment in 2003, Xunlei has provided more than 400 million Chinese users with P2P data transmission services. Now with its super Blockchain platform ThunderChain that can handle millions of transactions per second, the company is poised for unprecedented growth globally.

On May 16 in Beijing, Xunlei released two new products: an integrated cloud service with the concept of sharing economy StellarCloud and an open blockchain applications platform ThunderChain Open Platform.

From Blockchain 1.0 to 3.0

While its venture into the cloud and blockchain space began almost three years ago, Xunlei has already been accumulating solid experience through its distributed technology for more than 10 years. It has developed a revolutionary open Blockchain platform dubbed “ThunderChain” to take the industry by storm. The company says ThunderChain utilizes a breakthrough in the limitations of Blockchain smart contracts to solve complex problems facing industries like the financial, supply chain, healthcare, and public services.

In reviewing the evolution of the Blockchain technology, many people believe that cryptocurrencies can be categorized as Blockchain 1.0 whereas Ethereum’s adoption of a decentralized platform for a limited set of applications is categorized as Blockchain 2.0.

Today, a majority of blockchain applications are still deployed within an organization or just set up for transactions with limited frequency. Xunlei regards ThunderChain as Blockchain 3.0 since it is created to involve individual users and make a great impact on their daily work and life. Xunlei was, therefore, hoping to establish a high-performance ecosystem. And ThunderChain has been specifically created to focus on applications related to entertainment, copyrights and food safety particularly on issues regarding traceability and transparency.

The Rise of Xunlei in Blockchain Adoption

Blockchain technology should be adopted in real-life scenarios rather than only being studied in laboratories, as the problems encountered during practical use can help improve Blockchain technology and make new breakthroughs. This was what Xunlei CEO Lei Chen told at the Boao Forum for but also what his firm has been doing in China.

Just under a year ago, Xunlei launched a blockchain-based personal cloud computing service OneThing Cloud that helps consumers share their idle computing resources into a massive enterprise cloud computing infrastructure. Over 1.5 million consumers are participating in Xunlei’s cloud computing infrastructure, providing their computing resources for China’s largest video streaming, entertainment and internet companies, such as XiaoMi, iQIYI, PandaTV, and Kuaishou. Through a shared computing model, Xunlei helps these enterprises significantly reduce costs in bandwidth and computing.

In addition, the million-tps ThunderChain can support smart contracts written in the Solidity language, making it compatible with Ethereum and the vast array of existing technologies that use this system.

The Road Ahead

Billions of dollars are being invested in Blockchain today, and some of the smartest people on the planet are engaged in understanding how this technology can reinvent business processes across industries and endeavors. The potential impact of Blockchain is driving businesses to rethink existing business models, re-examine opportunities previously thought nonviable, and explore a new frontier of opportunity that can impact the bottom line and benefit society.

So, what’s the future ahead for Xunlei?

ThunderChain is now open its APIs to third parties, promoting the development of applications that serve for a large user base. Xunlei introduced measures including investment, incubation, and mentorship to help blockchain startups to build their business within its ecosystem participated by over one million active users. These include grants of 300 million LinkToken to ThunderChain developers that they exchange for cloud services or execution gas. According to Xunlei, the 300 million LinkToken was originally planned for the operational purpose, but now the firm would like to give all of them back to lure developers and startups to build their business on ThunderChain. Ultimately, both startups and end users could benefit from the blockchain, taking the technical development to another level.

Xunlei is also pushing its blockchain beyond China. In April, Thai government invited Xunlei to collaborate on several Blockchain initiatives as part of a wider goal of the digital transformation. Thailand intends to leverage its proprietary Blockchain infrastructure on two main digital projects, Digital ID System and Smart City, by leveraging ThunderChain’s high-performance and stable concurrent processing capability to record, analyze and manage billions of data points more efficiently and safely.

For Xunlei, it continues to put innovation and customer value high on the list of strategic priorities, while the financial goal – as stated by management recently – is also to improve the bottom line and deliver on the margins to drive growth. Regardless, the customer is always the king here. With a new blockchain ecosystem, Xunlei should keep focusing on both enterprises and personal customers to achieve a long-term growth in the era of Blockchain 3.0.

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