China, the world’s second largest economy and its biggest population, has seen steady expansion in the blockchain space. While bitcoin mining and trading is arguably a larger focus in the country at present, the blockchain industry is maturing and poised for major gains in terms of development and practical applications
These advancements come amid China’s 13th National Five-Year Plan (2016-2020), which has witnessed a strong beginning and is on target to hit several primary objectives for economic development set by the Chinese government.
Keys To Growth
A key element is China’s quest to become a global leader in blockchain technology, reinforcing the creation of a massive digital infrastructure to support the country’s soaring growth trajectory. These efforts are expected to align with efforts to develop advanced technologies in areas such as big data, artificial intelligence and an expanded 5G mobile service telecommunications network by 2020.
Last May, Shanghai-based nonprofit Wanxiang Blockchain Labs announced a new consortium called the ChinaLedger Alliance, which involves 11 regional financial institutions. The goal is to foster an open-source blockchain protocol for developers involved in fueling and unlocking the roadmap to China’s blockchain future.
A month later, a blockchain working group was established, a three-way collaboration between the government, ChinaLedger and the Shenzhen Consortium, with the goal of capturing group wisdom around the effective harnessing of blockchain potential in driving China’s next technological revolution. A number of major business players, including Alibaba Group’s Ant Financial Services, WeBank and Ping An Insurance, are involved in the curation of various blockchain related projects.
BitKan Takes a Central Role
BitKan, a Shenzhen-based company that provides Bitcoin-related tools and services such as aggregated news, mining monitoring and price alerts, is actively exploring blockchain technology-related development opportunities with other Chinese companies. These outreach efforts are designed to explore applications like private chain technology and how those applications can be leveraged for traditional industries.
“We are cooperating with some major companies in logistics, pharmaceuticals and philanthropy to explore more usage of blockchain technology,” said Liu Yang, CEO of BitKan. “Most of these explorations have already gone through the business analysis stage and advanced into the launching period.”
Yang noted that while the business model is good to go, some difficulties exist in guaranteeing the accuracy of the original data as well as the reliability of a strong hash rate.
“BitKan can provide complete solutions,” Yang said. “Once we adjust accordingly, it will take some time for us to implement all of the details.”
Yang is cautiously optimistic about the current movement taking place in China’s blockchain landscape.
“We are still exploring how to put blockchain technology into practical use,” he said. “A number of our corporations have done numerous trials which are quite beneficial. There have been many tests in the capital transfers space, yet there are no application that have been officially launched into the market. Blockchain in China is still a vague concept. But as we explore more of this technology, I do believe we’ll see fundamental changes taking place in two or three years.”
BitKan is collaborating with other companies to discover more ways of applying blockchain technologies into fields such as logistics and traceability.
“We hope to use this technology to solve the tough issues in these businesses, helping them improve efficiency and lower their costs,” Yang said.
When asked about where blockchain would have the greatest impact in terms of the future of business in China, Yang highlighted logistics and traceability, noting that all parties involved lack natural trust but must build it.
The high accountability and immutability qualities of the blockchain continue to garner attention in China amid the massive global shipping and cargo efforts in the country. Issues like loss and error rates in cargo shipping require critical tracing ability, an area where blockchain technology can have a major impact.
BitKan is also looking to get heavily involved in exciting new developments around private chains.
“A private blockchain is just like a public one when it comes to the distribution of data,” Yang explained. “Compared to the whole internet, Bitcoin is a private blockchain. While compared with some specific target user groups, private blockchains can be regarded as public ones within their own fields. If the problems we are solving are not targeted at users in general but at specific groups, then private blockchain technology could be very beneficial.”
Yang maintains a forward-looking vision, considering the trends that could emerge over the next 18 to 24 months.
“Currently blockchain technology is still currently going through trial and error,” he said. “But in my judgment I believe some real world applications will appear in the next two or three years in industries like logistics, pharmaceuticals, ticketing, capital transfer and credit investigation. A combination of private and public blockchains will be the technological trend that drives this.”