In Traditional Chinese Medicine, it is said...
1) Blood is denser form of Qi
2) Blood is inseparable from Qi
3) Qi moves Blood; Blood is the mother of Qi
4) Qi gives life and movement to Blood, but Blood nourishes the Organs that produce Qi.

The Origin of Blood
1) Food Qi produced by the Spleen is sent upward to Lungs, and Lungs push it to the Heart, where it is transformed into Blood. The transformation requires the assistance of the Original Qi stored in the Kidneys.
2) Kidney Essence produces Marrow: this generates the bone marrow, which contributes to making Blood.

Therefore: Blood is formed from the interaction of the Postnatal Jing (source of Food Qi, refined from Food by Spleen and Stomach) and the Prenatal Jing (stored in Kidneys). Chinese theory of blood forming function of the bone marrow predated the arrival of Western Medicine.

The Function of Blood
1) Nourishes the body: complements the nourishing action of Ying Qi. As a denser form of Qi, it flows with the (Ying) Qi in the vessels and channels all over the body.
2) Moistens body tissues, ensures that they do not dry out. Blood is part of Yin, fluid-like and moistening .
3) Supports the Shen. The Shen is said to live in the Blood Vessels, which are part of the Heart. The Blood nourishes and supports the Shen, giving it a foundation.

Where Blood is deficient, the Shen can become uneasy, with symptoms of vague Anxiety, slight irritability, unease and inability to fall asleep.