Bitcoin witnessed a major surprise earlier last week soon after Chinese President Xi Jinping’s major statement on blockchain. Jinping extended his support for the blockchain technology and urged the country to tap the vast potential that the technology offers. After the Jinping’s statement, Bitcoin registered a spike of $3000 from $7,500 to $10,500 in just a few hours.
Meanwhile, China is geared up to pose a big challenge to the US dominance prevailing in the blockchain technology. China is expected to use the blockchain technology right from launching digital money to restructuring a raft of Government services. The country also plans to use it to keep a hawk-eye on communist party’s loyalty.
The Chinese government has finally signaled that it now perceives blockchain technology as a vital part of the country’s plan to emerge a high-tech superpower. With this move, Beijing has emerged as the latest entrant to the list of countries that have adopted a law to govern the encryption of data particularly the blockchain technology. Blockchain technology permits the storage and direct exchange of date sans any intermediary.
Blockchain is a database that is shared across a vast network of computers. The moment a record is added to the chain, it is nearly impossible to change. According to Stanislas Pogorzelski, editor of the website cryptonaute.fr., “China has understood very well that to stay a superpower, you have to be at the forefront of new technologies.” Stanislas Pogorzelski said that the new law for blockchain technology is not very clear.
Meanwhile, blockchain is likely to play a vital role in several sectors that may include digital finance, Internet of Things, Artificial intelligence, and 5G. The technology may make China’s huge bureaucratic system more efficient. China’s official Xinhua News Agency claimed that the country used a blockchain-based system for the first time to automatically produce and file an enforcement case in court against a party who could not pay damages in a mediation agreement.
It is expected that the technology may make China’s judicial enforcement more transparent and intelligent as a result of less human intervention, added the agency. Chinese shares also surged soon after Xi’s welcoming statement on blockchain technology. Investors prefer to invest in blockchain-related stocks after the country’s president statement.
Blockchain should play a bigger role in strengthening Chinese power in cyberspace, developing the digital economy, and promoting socioeconomic development.
Earlier, authorities in China did not encourage investment in cryptocurrencies like Bitcoin (BTC). However, things are changing at a fast pace. Now, the country is making swift progress with major plans for national cryptocurrencies that may boost the government’s surveillance powers over the economy.
Now, the country is all set to introduce its own state-backed cryptocurrencies by eliminating contradictory posts that claimed that the blockchain technology was a scam.
Earlier, China’s central bank tried to figure out the likelihood of creating a cryptocurrency way back in 2014. But, bitcoin exchanges and several other cryptocurrency platforms were banned by the country.