BSN Alliance To Launch Government Blockchain in China
BSN, the first blockchain network run by a government is here. The People’s Bank of China (PBoC), in association with other domestic banking institutions, as well as local tech giants are about to launch the long-awaited state-backed blockchain platform.
The Blockchain-based Service Network (BSN) will act as an operating platform, where participant legal entities and individuals could build their own projects upon without having to create their own distributed ledger from scratch.
The government-private sector alliance mentioned above claimed that doing business on the state-backed BSN will be 80% more efficient when compared to other distributed networks, at least from an economic standpoint.
Furthermore, the plan is to install solid nodes to over 200 Chinese cities by the end of the year 2020, while the alliance is keen on expanding its service on an international scale as well.
According to the World Intellectual Property Organization (WIPO), China has the most blockchain-related patents filed worldwide, and it is the only country which’s leader publically promoted the usage of blockchain technology, highlighting its importance for China.
BSN Focuses On Blockchain, Not Crypto
Although Bitcoin and blockchain can be two intertwined concepts, China’s focus is currently set on the latter, as distributed ledger technology can offer much more than just an alternative digital economic system, one that China had already mastered way before blockchain was even a thing.
Nevertheless, PBoC is planning a nation-wide digital currency run by the central bank in association with the CCP, dubbed “DC/EP”, which stands for Digital Currency/Electronic Payments.
The central bank digital currency (CBDC) was meant to be released to the wild in late 2019, but PBoC has postponed its release several times since then.
Mu Changchun, the Deputy Director of the People’s Bank of China said that the state-backed digital currency is not rolling out anytime soon, despite international rumors.
As for public cryptocurrencies such as Bitcoin and Ethereum, as mentioned before China has a conservative stance, not because it doesn’t believe in Bitcoin – that would be a paradox, considering that the largest Bitcoin mining facilities are located in China – but due to the fact that domestic payments apps such as WeChat or AliPay offer netizens much of what Bitcoin does in a faster and easy-to-use fashion.
According to policy research firm IEEE, the relevant white paper published by the BSN Alliance confirms that telecommunication companies, digital payment processors, and hi-tech companies will be among the first participants of the network, which is tailored for business use-cases as it is a “permission” blockchain in opposition to Bitcoin’s “permissionless” architecture.
That shouldn’t come as a surprise, and if anything, we’ve heard the same story before with Facebook’s Libra, yet this time, it’s gonna be real, considering that not any government, but China is launching the project, and there should naturally be zero technopolitical and/or legal opposition.