China plans to accelerate blockchain development and adoption in push to become a world leader in the technology by 2025

In a new document, China’s internet governance agencies highlighted the country’s effort to establish an ‘advanced blockchain industrial system’

Despite cracking down on cryptocurrencies like bitcoin, China wants to be a global blockchain leader in other applications such as intellectual property

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China is ramping up efforts to develop its blockchain industry, which it hopes to make a world leader by 2025, according to a document from the Ministry of Industry and Information Technology and Cyberspace Administration of China. Photo: Shutterstock

Coco Fengin BeijingandMasha Borakin Hong Kong

Published: 12:00am, 9 Jun 2021Updated: 1:18am, 9 Jun 2021

China’s government is doubling down on its embrace of distributed databases with the establishment of an “advanced blockchain industrial system”, as the country looks to incorporate the technology into its economic and development plans.

The country plans to establish industrial standards, tax incentives and intellectual property protections to support the blockchain industry, for which it wants to become a world leader by 2025, according to a document released on Monday by the Ministry of Industry and Information Technology (MIIT) and Cyberspace Administration of China (CAC), the two agencies in charge of the world’s largest internet industry. The document also mentioned plans to enhance global cooperation under the Belt and Road Initiative (BRI).

“[The] recent guidance confirms policymakers’ long-standing commitment to blockchain technology as a key strategic technology,” said Matthew Graham, CEO of Sino Global Capital.

The document emphasises the necessity of cultivating national champions that can compete globally, as well as the importance of blockchain to the real economy – including supply chain management, product traceability and data sharing – and public services like identity documentation, property registration, and education and health care data management.

While cracking down on distributed cryptocurrencies running on blockchain, the Chinese government has also been trialling a central bank digital currency. Photo: Kyodo

While China has supported the development of blockchain within certain domains for some time, the industry has seen little progress beyond a burst of activity after President Xi Jinping endorsed the technology in late 2019.

Globally, the blockchain industry is dealing with a commercialisation bottleneck as some applications, like traceability and proof of copyright ownership, “are not as profitable as expected”, said Gao Chengshi, a cryptography expert and founding partner of blockchain developer Shanghai Hashvalue Information Technology. But the industry is still “at a very early stage”, he added.