China has decided to move deeper into blockchain technology after its ban on cryptocurrency transactions in 2021. A recent report from China Daily noted that the country is about to launch a research center for blockchain innovation in Beijing.
China’s National Blockchain Innovation Center will work with local universities, blockchain experts, and firms to explore core blockchain technologies.
China Readies To Boost Its Digital Infrastructure
According to the report, the research will yield results that will play vital roles in supporting China’s new digital infrastructure. The report noted that the innovation center would focus on basic blockchain theory, key technologies’ software, and hardware, including basic platform and verification networks.
The Beijing Academy of blockchain and Edge Computing (BABEC) will take charge of the new research institution. BABEC is famous for its ChainMaker blockchain. BABEC’s ChainMaker has backing from 50 business corporations, including the State-owned China Construction Bank (China Unicom).
Currently, ChainMaker executes 240 million transactions per second (TPS). In 2021, it processed 100,000 TPS. BABEC is a leader in blockchain technology, which explains why the state placed it in charge of the new research institution.
Despite China’s hawkish stance against cryptocurrency trading, the country has been active in blockchain innovation. China even prides itself as a blockchain nation. In September 2022, the Chinese government claimed that the country accounted for 84% of all filed blockchain applications worldwide.
While this claim may not be far from the truth, the approval rate of filed blockchain applications is significantly low. Currently, only 19% of the total filed applications have received approval.
Updates On China’s CBDC Development
Blockchain technology and the CBDC project became the Chinese government’s trademark. As for China’s CBDC development, the central bank has rolled out e-yuan (e-CNY), worth millions of dollars, across the country to promote CBDC adoption. According to a report, the Chinese central bank launched about 200 activities for e-CNY across the country during the holiday period.
These activities aimed to promote consumption. During this exercise, many cities in Chain rolled out 180 million yuan ($26.5) worth of CBDC in subsidies and consumption coupon programs. Global Times, a Chinese English-based news outlet, cited cities like Shenzhen’s local government gave out more than $14.7 million worth of e-CNY to subsidize the catering industry.
China has made several efforts, including setting targets for different cities to boost its CBDC usage. Another report noted that Hangzhou city issued 80 yuan worth of e-CNY vouchers to each resident on January 16. The city gave away a total of 4 million yuan ($590,000) worth of e-CNY.
Also, on February 1, senior ruling party officials in Suzhou City set a speculative key performance indicator for the end of 2023. The officials projected a 2 trillion yuan ($300 billion) worth of e-CNY transactions in the city by the end of 2023.
Their target is high for a single city, given the total e-CNY transactions barely exceeded 100 billion yuan ($14 billion) in October 2022, two years after the CBDC launch.
The e-CNY wallet app featured a capability of sending red packets called hongbao for gifting money to attract new users. Earlier in January, the app also received an update to allow users to carry out wireless payments using Android phones.
China has been a world-renowned technology hub over the years. With the new blockchain innovation research center, China could advance deeper and even become more successful.
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