No other country has laid out, funded, and executed as comprehensive a blockchain policy as China, writes Abhas Jha, who works on technology, cities, resilience, and public policy at the World Bank.
Beijing’s 145-page document lays out a comprehensive vision of using blockchain as a framework for creating a whole-of-government digital platform that breaks down data silos and has open APIs that allow interoperability across agencies. Twelve application cases include the facilitation of logistics through airports and ports, cross-border trade, a city financial electronic identity authentication system, and a district finance platform for SMEs.
The People’s Bank of China (PBOC) is currently running the world’s first pilot central bank digital currency called the Digital Currency Electronic Payment (DCEP). Mobile wallets enabled to work with DCEP are running in four Chinese cities — Shenzhen, Suzhou, Xiong’an, and Chengdu. The four major banks of China are participating in this pilot. This partnership could help DCEP reach over 500 million users in China. The assumption is that DCEP will allow the PBOC to crack down on money laundering and counterfeiting as well as better monitor capital flows and enforce capital controls.
DCEP and other initiatives create a market, both domestically and abroad, for blockchain-enabled products in which Chinese firms will set the standards. Long-term financing from agencies like the Chinese Export-Import Bank and the China Development Bank will allow Chinese firms to establish a first-mover advantage in acquiring market share in key emerging markets.