Written by Dyami Millarson
Taoism prohibits blood sacrifice (see Chinese source here), and Buddhism is against this as well. This means that blood sacrifice is, at least originally speaking, the distinguishing feature of Chinese folk religion, because Chinese religion originally has no prescriptions against this, though influences from Taoism and Buddhism may be present in modern times.
The study of the features of Chinese folk religion is relevant because Germanic and Chinese religion may both be considered folk religions, ancient polytheist belief systems that endorse ritual sacrifice as a method of interaction with the spiritual. While the most striking feature of Germanic folk religion is blood sacrifice, it is interesting to know that this applies to Chinese folk religion as well. For our studies, we ought to take a good look at the role of blood sacrifice in Chinese beliefs. I do recall an instance where Confucius partook in a blood sacrifice; his pupil questioned him about this in a hostile manner, but he defended blood sacrifice saying that his pupil loved the sheep and he loved the tradition (you may read a fuller explanation of this saying by Confucius on this English external site).
Particularly in ancient times, Chinese people offered cattle, sheep and pigs to the spiritual realm. This custom declined, however, with the advent of Buddhism and Taoism, which prohibited this as aforementioned. We should, therefore, focus particularly on the ancient times when we study the Chinese sacrificial custom that used to be prevalent among the Chinese and that simultaneously used to be the distinguishing feature of Chinese folk religion in ancient times (i.e., ancient Chinese religion), yet this distinction eroded over time under the influence of Buddhism and Taoism which interacted with Chinese folk religion.