Introduction to Blockchain in China

Blockchain technology was first introduced to the world with the publication of Bitcoin: A Peer-to-Peer Electronic Cash System by Satoshi Nakamoto in October 2008. The rapid rise in Bitcoin’s price and trading volume in 2013 caught the attention of the Chinese government, leading to regulations being introduced to strengthen supervision and address financial risks. The Chinese government differentiated between cryptocurrencies and blockchain technology, regulating the former strictly and encouraging the development of the latter.

Recognition and Support for Blockchain Technology

The Chinese government and public have come to recognize the value of blockchain technology, and in 2016, the Ministry of Industry and Information Technology released a whitepaper outlining the development and applications of blockchain both domestically and internationally. The State Council of China also included blockchain technology in the 13th Five-Year National Informatization Plan, marking the start of official promotion of blockchain development.

Strengthening Regulations and Encouraging Innovation

Despite the increasing popularity of Initial Coin Offerings (ICOs), the Chinese government has strengthened regulations to address risks such as fraud and illegal fundraising. However, they continue to actively support the innovation and application of blockchain technology, with local governments promoting its development and experimentation. The favorable policy environment has led to a wave of innovation and entrepreneurship in the industry, with major enterprises and institutions carrying out their own blockchain initiatives and projects.

Overview of China’s Blockchain Policy

China’s central bank (PBOC) has a tight control over the spread of cryptocurrencies in the country due to their potential to bypass capital controls. Bitcoin, for example, is considered a virtual asset and is not considered a currency by PBOC, making it illegal to use as currency or collateral in the Chinese market. Additionally, all forms of capital raising activities through cryptocurrencies, such as ICOs and STOs, are banned in China due to potential financial crimes such as illegal issuance of tokens, financial fraud, and pyramid schemes.

PBOC’s Own Digital Currency

Despite the restrictions on cryptocurrencies, PBOC has started exploring the possibility of launching its own digital currency to reduce the costs of traditional paper money circulation and increase policymakers’ control over the money supply. According to a deputy director at PBOC’s payments department, the central bank is «almost ready» to issue the country’s sovereign digital currency.

Cryptography Law

China’s first cryptography law became effective on January 1, 2020. The law aims to promote the stable and secure development of cryptography and improve China’s cybersecurity systems. It classifies cryptography into core, common, and commercial cryptography, with core and common cryptography used to protect national secrets and governed by strict cryptography authorities. The law also seeks to guarantee the information security of citizens, enterprises, and organizations.

Blockchain Regulation in China

China’s regulation of blockchain finance mainly uses administrative measures and applies a command-based regulatory model with a strict one-size-fits-all approach. However, in areas outside of finance, relevant specialized laws are lacking but the country is taking a positive attitude towards accelerating the implementation of blockchain technology applications.

Applications of Blockchain Technology: A Review»

In recent years, the implementation of blockchain technology has seen successful adoption across various industries in China. In this section, we highlight several successful and noteworthy blockchain application cases in selected industries.

According to CCID Consulting, the majority of blockchain applications in China concentrate on financial services and enterprise services. Specifically, blockchain applications in the financial sector mainly cover areas such as cross-border payments, insurance claims, securities trading, and bills.

Overview of the Blockchain Industry in China 2023

Blockchain Application Cases in the Agriculture Industry

Blockchain Application Cases in Supply Chain Finance

Blockchain Application Cases in Logistics

Introduction of Top Chinese Universities Involved in Blockchain

Name Introduction
Tsinghua University A major research university in Beijing and a member of the C9 League of Chinese universities. Established in 1911, it has produced many Chinese leaders in various fields.
Peking University A major research university in Beijing and a member of the C9 League. Founded in 1898, it is the first modern national university in China and has educated many prominent Chinese figures.
Fudan University A prestigious and selective university in Shanghai, founded in 1905 by renowned educator Ma Xiangbo.
Shanghai Jiao Tong University A major research university in Shanghai established in 1896. Known as «The MIT of the East,» it is one of the oldest and most prestigious universities in China.
Tongji University A comprehensive university located in Shanghai, founded in 1907 by the German government and German physicians. One of the oldest and most prestigious universities in China.
Zhejiang University An elite C9 League university in Hangzhou, established in 1897. One of China’s oldest, most selective, and prestigious institutions of higher education.
Renmin University of China An elite research university in Haidian District of Beijing, founded by the Communist Party of China. Classified as a Class A university under the Double First-Class University Plan.
Central University of Finance and Economics A national key university, founded by the China Central Government and now under the Ministry of Education of China. Offers subjects in economics, management, law, literature, philosophy, science, engineering, pedagogy, and art.
Beijing University of Posts and Telecommunications A key national university known for teaching and research in cable communications, wireless communications, computer, and electronic engineering. One of the top engineering schools in China.
Beihang University A major public research university in Beijing emphasizing engineering, technology, and the hard sciences. Previously known as Beijing University of Aeronautics and Astronautics.
Xidian University A public research university in Xi’an, administered by the Ministry of Education of China. Focuses on electronics and information education and research and offers programs in engineering, science, management, economics, liberal arts, and social sciences. A Double First-Class Discipline University with highly ranked programs in electronic engineering and computer science.