China's CAC Launches Nationwide Initiative for Blockchain Development Despite Crypto Ban

Despite a strong stance against crypto adoption, China continues to show interest in adopting blockchain and NFTs.

By Shomik Sen Bhattacharjee | Updated: 31 January 2022 12:05 IST

China's CAC Launches Nationwide Initiative for Blockchain Development Despite Crypto Ban

Photo Credit: Reuters

China has identified several areas to test blockchain technology

Highlights

China intends to work on blockchain development for real-world use
A number of key Chinese cities have been listed for trials
China is working on a platform for NFTs in the country

Cyberspace Administration of China (CAC), the country's central Internet regulator, censor, oversight, and control agency, has revealed the launch of an internal attempt to accelerate blockchain advancement and innovation in over 15 regions and 164 organisations. Despite having imposed a blanket ban on crypto trading and mining operations in September 2021, the effort intends to integrate blockchain technology on a nationwide scale in China's enterprises and government entities. The initiative will kick off with "comprehensive" trials in cities that include Beijing, Guangzhou, and Guiyang.

The CAC, together with other government organisations, issued orders to regulatory authorities to “promote the intensive and balanced layout of blockchain technology infrastructure in the region, form a large-scale production-level cross-chain data exchange support capability, and promote the formation of a multi-party collaborative blockchain industry ecology.”

The statement also involved a list of cities, companies, and other organisations that will be actively engaged in the blockchain experiments based on regional and departmental suggestions.

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The main factors of blockchain innovation include production, energy, government data sharing and services, law regulation, taxation, criminal trials, investigation, trademark, civil affairs, human culture, education, healthcare, trade finance, risk control management, stock market and cross-border funding.

The directive also indicates the significance of regulatory departments cooperating in the development and promotion of pilot initiatives “and give full play to the role of blockchain in promoting data sharing, optimising business processes, reducing operating costs, improving collaborative efficiency, and building a trusted system.” Entities involved in the program are also encouraged to use blockchain-related hardware products and software that are “interoperable” and “sustainable,” it added.

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Despite its strong resistance to crypto adoption, China's government is still interested in associated areas such as blockchain and non-fungible tokens (NFTs). As per a recent Bloomberg report, the Blockchain-based Service Network (BSN), a Chinese government-backed blockchain venture, has been working on infrastructure to help firms and people develop NFT-focused platforms and apps. The project seeks to assist the establishment of platforms that are able to trade non-crypto NFTs using fiat currency.

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