On July 28th, the technology and growth sectors experienced a severe downturn, with the Shenzhen Component Index falling 4.52% and the ChiNext Index dropping over 7%. Amidst this gloomy sentiment, one segment of the healthcare sector managed to break out against the trend: brain-computer interfaces (BCI). The related index rose another 2% after surging 5.85% the previous day, with Aipeng Medical hitting the 20% daily limit for a second consecutive day, Innovative Medical advancing for four out of the last five days, and Sanbo Brain Hospital gaining 4%.

On the news front, significant breakthroughs are occurring both domestically and internationally. The US-based BCI company ScienceCorp has received approval to sell its retinal chip in the European Union, marking the first time a US BCI company has scaled up distribution to the patient market. Domestically, a research team has achieved the first-ever simultaneous brainwave collection across a thousand-person region. Policy-wise, the "15th Five-Year Plan" has explicitly included strengthening BCI research and development. Is the commercialization year for brain-computer interfaces finally arriving? To seize the investment opportunity, read on for a comprehensive guide to BCI opportunities.

What is a Brain-Computer Interface?

In a nutshell, it means controlling machines with your thoughts. Specifically, a BCI acts as a bridge between the brain and external devices. It works by collecting brain signals, decoding them into commands, and sending those commands to an external device for execution. A complete BCI system typically includes five stages: brain signal acquisition, information decoding and processing, signal output/execution, external device, and feedback. For example, if you think of the action "raising your hand," the system captures the corresponding brain signal, decodes it, and drives a robotic arm to lift up.

From Science Fiction to Reality: BCI Reaches a Historic Industrialization Inflection Point

In 2025, a Chinese patient who had been paralyzed from a spinal cord injury for 13 years successfully controlled a computer cursor using their "mind" through an implanted BCI system. In 2026, the world's first medical device certificate for an invasive BCI was approved in Shanghai. Brain-computer interfaces are moving from the laboratory into reality. From an investment perspective, BCI, as a revolutionary underlying technology connecting biological intelligence and AI, may be at a critical juncture in its leap from the lab to commercial application. On the policy front, the "15th Five-Year Plan" has designated it as one of six future industries, and medical insurance payment channels are gradually opening up, addressing a key pain point for commercialization. On the technology front, the US-China race is accelerating, with Neuralink planning mass production in 2026 and China's first successful invasive clinical trial. On the capital front, global investment and financing have exceeded 1,000 deals, totaling nearly $10 billion, with significant resonance between the primary and secondary markets. In summary, the industry is shedding its speculative concept phase and entering a substantive stage of commercial realization.

Breaking Down the Industry Chain: Upstream Focuses on Technology, Midstream on Licenses, Downstream on the Market

1. Upstream: Electrodes and Chips (The "Bottleneck")

The upstream segment is the technological high ground of the BCI industry chain, where the most value is concentrated. The core components are two things: electrodes and chips. Electrodes act as the "ears," capturing brain signals. They are categorized into invasive and non-invasive types based on the degree of penetration. The former are implanted directly into the brain cortex for high signal precision but carry higher risk; the latter are worn on the head, are safe and convenient, but have limited signal accuracy and are the mainstay of the consumer market. Chips act as the "translator," responsible for amplifying, filtering noise from, and converting weak brain signals into digital signals. BCI chips are developing towards higher throughput, lower power consumption, and miniaturization. Currently, high-end chips are primarily imported, with domestic companies accelerating their catch-up efforts.

2. Midstream: System Integration and Algorithms (From Brain Signals to Control Commands)

The midstream segment is the crucial hub for industrialization. The task here is to integrate upstream hardware like electrodes and chips into a usable BCI system. The core capabilities include: 1) Hardware system integration: assembling complete brainwave acquisition equipment; 2) Signal processing and algorithms: performing noise reduction, amplification, and decoding of brainwaves to "translate" weak brain signals into recognizable commands; and 3) Software platform development: building a control platform to enable interaction between the brain and external devices. There are four main technological routes: fully invasive, semi-invasive/minimally invasive, endovascular, and non-invasive. Their core differences lie in implantation method, level of trauma, signal quality, and commercialization pace.

3. Downstream: Application Scenarios (From Medical Rehabilitation to Consumer Lifestyle)

The downstream segment is where BCI value is realized and is the fastest-growing market. Healthcare is the current largest and most mature application scenario, with uses for stroke rehabilitation, Parkinson's diagnosis, depression treatment, and early screening for Alzheimer's disease. Consumer applications are a new growth area that is rapidly opening up, including sleep monitoring headbands, emotion recognition, smart home control, and educational assistance. Non-invasive technology, with its advantages of safety and convenience, is moving from healthcare to civilian use, offering the greatest potential for imagination. Future development is expected to evolve through three stages: from "neuro-rehabilitation" to "cognitive enhancement" and finally to "brain-computer integration." The extension into healthcare, combined with consumer and tech sectors, points to a vast future market.

Current State of Technology Roadmaps: Non-Invasive Dominates Short-Term Gains, Invasive Tackles the Ultimate Barrier

As mentioned above, BCI is divided into four main technological routes based on signal acquisition methods. Currently, non-invasive technology, with its high safety and low cost, is the fastest to commercialize in the rehabilitation and consumer sectors, holding about 78% of the market share. It is the core driver for short-term cash flow. Semi-invasive technology holds about 15% of the market, balancing performance and safety. Although invasive technology accounts for only 7% of the market, its extremely high signal precision makes it the core solution for serious medical conditions like severe paralysis, representing the ultimate vision for the technology and a high valuation premium.

Market Size: Global Market Enters High-Growth Phase, Aiming for Trillions of Dollars

The global BCI market is in an acceleration phase driven by both medical and consumer sectors. The global market size was approximately $2.6 billion in 2024 and is projected to reach $7.63 billion by 2029, with a long-term CAGR remaining between 15% and 25%. In the long term, if widespread application in the consumer sector occurs, the market could surpass $300 billion by 2040. The Chinese market, driven by massive clinical demand and policy support, is growing significantly faster than the global average. The Chinese market size reached 3.2 billion RMB in 2024 and is expected to exceed 10 billion RMB by 2029. China's share of the global market is steadily increasing, forming a dual-core industry landscape led by the US and China.

Investment Strategy: Focus on High-Barrier "Water Sellers" and Scenario Enablers

Industry chain investment focuses on three main themes. First, target the "water sellers" that control the industry's bottleneck, focusing on hard-tech companies with core electrodes, specialized chips, and CDMO manufacturing capabilities. Second, look for medical device leaders with channel and scenario advantages, which can most quickly translate technology into financial profits, achieving "BCI+" empowerment. Third, consider mapping and participating in primary market unicorns. For ordinary investors, using index funds like ETFs is a more efficient and convenient way to participate. Currently, there are no pure "BCI indexes" or index fund products in the A-share market. Investors can look at indexes related to BCI, such as the CSI Medical Index and the Hong Kong Stock Connect Medical Theme Index. Relevant ETF products include the Medical ETF (512170) and the Hong Kong Stock Connect Medical ETF (159137). The Medical ETF (512170) is the largest medical and pharmaceutical ETF in the market*, focusing on medical devices (including BCI) and medical services, while also incorporating the AI medical concept. Its OTC feeder fund code is 012323. The Hong Kong Stock Connect Medical ETF (159137) holds significant positions in the innovative drug industry chain, along with scarce leaders in AI medical and medical devices (including BCI). Its underlying assets are Hong Kong stocks, and it supports T+0 trading. Its OTC feeder fund code is 026922.

Data sources: China Galaxy Securities Digital Financial Center, public market information, Shanghai and Shenzhen stock exchanges, CSI Index Company, etc. Some images are AI-generated. Data as of June 30, 2026. The Medical ETF (512170) has a scale of 25.623 billion RMB, ranking first among all medical and pharmaceutical ETFs in the market. Institutional views: Galaxy Securities, July 26, 2026, "A Picture Guide to the BCI Industry Chain"; Everbright Securities, July 20, 2026, "Cross-Market Weekly Report on the Pharmaceutical and Biotech Industry: Policy, Clinical, and Technology Drivers Intensify, BCI Commercialization Inflection Point Approaches."

Note: The ETFs mentioned in the article do not charge sales service fees. Fund rates are detailed in the legal documents for each fund. Risk warning: The index constituents shown in the article are for display purposes only. Descriptions of individual stocks do not constitute investment advice of any kind, nor do they represent the holdings or trading activity of any fund managed by the manager. The composition of the underlying index constituents is adjusted according to the index's compilation rules. The risk level for the Hong Kong Stock Connect Medical ETF (159137) and the Medical ETF (512170) feeder funds, as assessed by the fund manager, is R4 (medium-high risk), suitable for aggressive (C4) and above investors. The risk level for the Medical ETF (512170) is R3 (medium risk), suitable for balanced (C3) and above investors. Any information appearing in this article (including but not limited to stocks, comments, predictions, charts, indicators, theories, and any form of expression) is for reference only. Investors must be responsible for their own investment decisions. Furthermore, any views, analyses, or predictions in this article do not constitute investment advice of any form to readers, and the authors are not responsible for any direct or indirect losses arising from the use of this content. Fund investment carries risks. Past performance of a fund is not indicative of its future results. The performance of other funds managed by the same fund manager does not guarantee the performance of any specific fund. Fund investment requires caution. MACD golden cross signal forms, these stocks are performing well!