China Embracing The Power Of Blockchain.
For the past some years, China has had a reputation for being anti-cryptocurrency and blockchain. However, this image appears to be changing for the country. Muyao Shen, writing at Forbes, reports that May 2019 may be the month that will be known as the time when China did a U-turn and started to acknowledge blockchain technology.
According to her Forbes report, more blockchain projects in China are provided with government support, including even working with government bodies to develop know-how for future blockchain platforms. This is distinctly different to the environment back in September 2017, when the People’s Bank of China (PBoC) together with several other central government agencies and financial regulators announced that it would ban initial coin offerings (ICOs).
When China shut down all domestic cryptocurrency exchanges in September 2017, Binance quickly moved the headquarters and servers of Binance to Tokyo, outside the reach of Hong Kong and the Chinese regulators, and then to other global markets, including Singapore and Taiwan.
NEW MOVES TOWARDS EXPANDING IN BLOCKCHAIN SPACE
Now, after a period during which any talk of blockchain or crypto in China was distinctly muted, things are moving forward. For example, the Cyberspace Administration of China (CAC) recently released the first list of registered blockchain service providers.
There are 197 businesses included on the list which, according to analysts, is meant to “provide a controllable environment to explore blockchain technology,” the Global Times reports.
Featuring on the list are well-known Chinese internet firms like Baidu Blockchain Engine (BBE), Alibaba Cloud Blockchain-as-a-Service (BaaS), and Tencent BaaS (TBaaS).
The ‘cyber police’ appear to be the officials hosting many of these meetings with tech companies, according to information from Xuemai Yu, chief executive officer of Hangzhou-based blockchain company DataQin. Yu also remarked that officials were keen to explain the nuances of the regulation: “The most important part was that they’ve divided all the blockchain projects into two categories, blockchain service providers and blockchain technology providers.”
The registry was created in response to the wave of unregulated initial coin offerings (ICO) in recent years. To be featured on the list, companies must be reviewed by the Chinese State Internet Information Office and meet the criteria laid out in the “Regulations on the Management of Blockchain Information Services”.
It’s also illegal to conduct any form of ICO in China; in this sense, the list serves to highlight illegitimate businesses running unregistered offerings. But still, this won’t be sufficient to stop blockchain firms from claiming false registration.
“From the central government’s perspective, they want to make sure any information that could potentially harm the national security and stabilization wouldn’t spread on the Internet through blockchain,” Yu said.
Will this reversal of fortune for blockchain in China ripple out to have an effect on global attitudes to the technology? That is an interesting question, to which I have no answer right now.