Blockchain technology has the potential to take the world by storm. Blockchain is an anonymous platform where the real user’s identity is not revealed in any transaction. However the Chinese government seems to have a different plan.
The Chinese Government’s new regulation
The Chinese Government has come up with a new regulation. The government requires every user to submit their real names and identity numbers before registering for a blockchain service. Bitcoin trading is already banned in the country and now there will be restrictions on blockchain technology development as well. The CyberSpace Administration of China, the country’s internet regulator, released a policy which also states that it requires blockchain services to remove illegal information quickly before it spreads among the users.
The services will also be required to retain backups of user data for six months and provide the information to law enforcement whenever necessary. The law breakers will be warned the access to their accounts will be restricted, or their accounts will be shut down, depending on what service providers deem appropriate.
The new policy is all set to be implemented from November 2.
The crypto ban
The Chinese government banned domestic Bitcoin exchanges last year, including all initial coin offerings of digital currencies. Later a ban was put on crypto trading by restricting foreign exchanges, even though blockchain technology development was still encouraged. However the government’s policies on blockchain have been more favorable in the past. A July industry report from the South China Morning Post and 500 Startups Greater China found that the Chinese government was supportive of blockchain services — at least on the local level. Being technologically forward-thinking, startup central Shenzhen and Alibaba’s hometown of Hangzhou established large blockchain funds. It now appears that this aspect of forward thinking will come with some additional caveats that challenge one of blockchain’s core advantages: privacy and anonymity.
The restrictions can clearly be seen in the mobile payments industry. Apps like WeChat requires users to register with a bank card or a national ID for over 1000 RMB ($143.99) to use the services. Other apps like Weibo have similar policies. You are required to enter a Chinese phone number to start the services.
Uses of blockchain platform in the recent year
There have been two notable episodes last year. The users were able to undermine the state authority through the power of blockchain technology. In April, some students used the Ethereum blockchain to upload an open letter about sexual assault and harassment that was written by a student who was threatened not to speak. In other instance the users who were angry about low quality vaccines, posted a viral news article on the blockchain in order to preserve it from censorship.
Both the letter and the article are still available on the blockchain network.
Blockchain wave continues to dominate different sectors. Various industries all across the globe have already started adopting blockchain technology.
What do you think about the new policy that the Chinese government has planned? Do let us know in the comments section.