Tencent Cloud leaps into crypto with partnerships
Tencent Cloud tags itself as the largest company operating under the internet banner in China. Its flagship products, like WeChat and QQ, are used by millions of people in Asia.
After operating as a high-performance, reliable, and secure cloud computing service for years, it jumped into the blockchain-powered economy in 2023 with a series of partnerships.
Below, we examine some of the partnerships and their potential impact on the future of the decentralized finance (DeFi) sector.
Tencent Cloud has partnered with MultiversX
MultiversX was formerly called Elrond and has been labelled an Ethereum Killer. MultiversX aims to compete with other smart contract platforms by having an ecosystem of cryptocurrencies and DApps (decentralized applications).
On 16 February, 2023, MultiversX said it had allied with Tencent Cloud to help the company with its mission of expanding its Web3 products.
Through this partnership, Tencent will use the possibilities of its technology and MultiversX’s network to deploy a range of products on the project’s blockchain.
The Vice President of the cloud computing company, Leo Li, said that liaising with MultiversX was a way of deepening connections between the real and virtual world.
The announcement had a huge impact on the crypto market as ELGD, the native asset behind the MultiversX protocol, rose by 14% from an opening day price of $46.41 to an intraday high price of $53.06.
The day's trading volume was around $123 million, corresponding to a market capitalization of $1.2 billion.
Avalanche and Tencent Cloud partnership
Avalanche is among the most patronized protocols and plays an integral role in the DeFi and NFT (non-fungible token) markets. AAVE, Benqi, GMX, Trader Joe, Stargate, Yield Yak, Vector Finance, Platypus Finance, Pangolin, and CIAN are some of the DApps deployed on Avalanche, which has given the chain a TVL (total value locked) of approximately $600 million.
As a top 10 NFT blockchain by all-time sales, with around $430 million, Avalanche is also a major player in the digital collectibles space.
On 22 February, 2023, Avalanche disclosed that it has partnered with the Chinese company to support developers and projects in its ecosystem.
Avalanche’s subnets (a piece of the Avalanche network) will also be explored by both parties as it is used by many enterprises. Representatives of Avalanche believe it will help accelerate the adoption of Web3 businesses across several businesses in the mainstream.
With this, more products can be added to Avalanche's suite of Web3 products which already includes a bridge, explorer, and wallet.
AVAX, the native asset behind Avalanche, saw a substantial rise in trading volume for the day. About $606 million was poured into the coin after it reached an intraday high price of $21.46.
The new alliance deepened AVAX's status as a medium digital asset by value, with a market capitalization of $6.4 billion (medium cap assets range between $2 and $10 billion).
Chainlink allied with the company in May
Chainlink joined the crypto market to help solve the problem of interoperability, as many blockchains were built with independent features. Over time, it has become one of the most patronized decentralized oracle networks.
On 31 May, 2023, Chainlink announced via its official X handle (formerly Twitter) that it had teamed up with the internet firm to support Web3 startup development.
The teaming up of the two firms will see BUILD projects under Chainlink receive a minimum of $10,000 worth of default vouchers for Tencent Cloud services.
The vouchers will facilitate access to the internet company's various cloud computing resources, including but not limited to networking, storage, and power.
As one of the coins hit hard during the crypto winter, which was born out of the collapse of Do Kwon's Terra Network in May and Sam Bankman-Fried's FTX in November 2022, LINK rose slightly on the back of the announcement.
As of 13:00 UTC on 11 August, 2023, LINK was exchanging hands for $7.55, and many analysts forecast the coin to breach the $10 mark again and retest $20 in the future.
Web3 is seen as the next iteration of the internet, where billions of people across the globe will be able to connect through decentralized systems.
Being at the helm of the internet through its cloud computing services means that Tencent Cloud will play an instrumental role in the future of the blockchain-backed economy, which relies solely on the internet to function.
With partnerships with MultiversX, Avalanche, and Chainlink leading to a rise in their respective native assets, more strategic team-ups could reflect positively on the overall market capitalization of the crypto industry.
Author: Raphael Minter
Raphael Minter/ Albert Zuhnden (preferred pen name) is a crypto finance writer, data miner, and fundamental analyst. Raphael has written hundreds of articles about centralized and decentralized financial instruments such as precious metals, commodities, stocks, and cryptocurrencies. He broke into digital finance in 2016 and believes digital assets and blockchain technology is the future of finance.