China Defies Crypto Ban, Embraces Blockchain for BRI Connectivity

China is actively developing a massive blockchain network, despite its strict anti-crypto stance. The project, known as the 'Ultra-Large Scale Blockchain Infrastructure Platform for the Belt and Road Initiative,' aims to facilitate government participation in blockchain-related activities, particularly in cross-border settings. This effort is part of China's broader interest in exploring the Web3 sector, including setting standards for metaverse technology and conducting advanced CBDC trials.

China Embraces Blockchain for Cross-Border Connectivity, Despite Crypto Ban

Beijing, April 2, 2024 - Defying its unwavering stance against cryptocurrencies, China is forging ahead with the establishment of a colossal blockchain network that aims to bolster its global infrastructure ambitions. The initiative is spearheaded by the "Ultra-Large Scale Blockchain Infrastructure Platform for the Belt and Road Initiative."

Announced in 2013, China's Belt and Road Initiative (BRI) is a visionary development strategy that seeks to link continents across land and sea through an interconnected web of infrastructure. The blockchain platform, helmed by the Conflux Network, is poised to play a pivotal role in facilitating cross-border collaboration within the BRI framework.

The Conflux Network, a multichain blockchain system, is operated by the Conflux Foundation, also known as the Shanghai Tree-Graph Blockchain Research Institute. The network recently announced the launch of the platform, promising "the base for developing applications that showcase collaboration across borders."

This latest endeavor underscores China's growing interest in exploring the potential of Web3 technologies. The Chinese government has recently signaled its readiness to harness the power of metaverse technology, establishing a dedicated body to guide its development in the country.

In January 2024, the government convened a group of Chinese tech giants, including Tencent, Baidu, and Ant Group, to forge standards for the responsible deployment of metaverse technologies.

China's blockchain ambitions extend beyond domestic shores. The country is leading the Asian market in conducting advanced trials of central bank digital currencies (CBDCs), with international banks like Standard Chartered actively involved.

Despite its blanket ban on crypto-related activities in September 2021, an underground network of crypto traders has managed to sustain trading operations. According to a December 2023 report by Kyros Ventures, stablecoins, in particular, have gained popularity in China, with over 33% of Chinese investors holding these digital currencies.

The Chinese government's embrace of blockchain technology, while paradoxically coupled with its prohibition of cryptocurrencies, reflects a nuanced approach to harnessing technological advancements. Blockchain's immutable and decentralized nature holds immense promise for secure cross-border transactions and collaboration, potentially boosting China's economic and geopolitical influence.

As China continues to navigate the evolving landscape of digital currencies and Web3 technologies, the global community will undoubtedly follow its progress with keen interest. The convergence of China's formidable technological prowess with a massive blockchain network has the potential to reshape global connectivity and economic landscapes.