Advertisement
Blockchain
TechPolicy

US lawmakers target Chinese blockchains BSN, Conflux in bill that brings tech decoupling to Web3

  • Two US House representatives introduced a bill barring executive agencies from contracting with China-based blockchain firms
  • The Blockchain-based Service Network and Conflux Network distanced their international operations from China, inviting people to examine their code

Reading Time:3 minutes
Why you can trust SCMP
6
Two US House lawmakers are looking to block government use of Chinese blockchain. Photo: Shutterstock
Xinmei ShenandOrange Wang
US lawmakers introduced a bipartisan bill on Wednesday aimed at barring federal agencies from using China-developed blockchain networks or doing business with related companies.

The bill Creating Legal Accountability for Rogue Innovators and Technology (Clarity) Act, introduced by House Representatives Zach Nunn and Abigail Spanberger, prohibits the heads of executive-branch agencies from purchasing or signing new contracts for blockchain systems and services reliant on certain China-based firms. It also bars government officials from lending or granting funds for transactions to such technology providers.

As examples of “foreign adversarial” distributed ledgers, the bill explicitly lists the Blockchain-based Service Network (BSN) and the network’s IT infrastructure service Spartan Network, along with its Hong Kong-based tech provider Red Date Technology. Blockchain firm Conflux Network and iFinex, owner of Hong Kong-based Tether, the company behind the world’s largest stablecoin, are also named.

BSN is among blockchain companies that “pose risks to the national security and foreign policy interests of the United States”, the lawmakers said. They called on government agencies to regularly conduct risk assessments on the named blockchain services.

BSN was founded in 2020 by a consortium consisting of Red Date, state-owned telecommunications giant China Mobile, bank-card clearing service UnionPay, and China’s State Information Centre, a government think tank under the National Development and Reform Commission.

The initiative’s main goal is to push the adoption of blockchain in enterprise IT systems without the involvement of cryptocurrencies. While operating an enterprise-facing blockchain infrastructure service in China, BSN last year also made a major push overseas with the launch of the Spartan Network, targeting businesses outside mainland China.

The BSN Spartan Network is “an application-agnostic infrastructure” used to serve traditional IT systems, and is “completely open source”, Tim Bailey, Red Date’s vice-president of global business and operations, said in a written statement to the Post.

“We welcome agencies from the US or any government to review the source code and make their conclusions about the technology,” he said.

Advertisement