Finally, China is warming up to blockchain businesses.
More and more China based blockchain projects are being approved by the local and provincial government bodies. Some of these projects are for the government bodies themselves.
The Past
Not long ago, on September 4, 2017, the People’s Bank of China, several central government agencies and financial regulators together issued a joint statement that Initial Coin Offerings (ICO) are banned in China. Soon after that the Chinese regulators shut down all existing cryptocurrency exchanges in China. That crackdown resulted in Binance moving away its HQ and servers from China to elsewhere.
That is water under the bridge now.
Regulations and Regulatory Actions
The Cyberspace Administration of China (CAC) recently published its first batch of registered blockchain service providers. The list could be viewed here in Chinese language: BlockchainServiceProviders. There are a total of 197 companies on the list and it includes some household names such as Alibaba, Baidu and Tencent. These blockchain service providers are registered pursuant to the Regulations on the Management of Blockchain Information Services.
For the purposes of the regulations, the regulators have divided blockchain project into two categories: Blockchain Service Providers and Blockchain Technology Providers. The intent behind such categorization is not clear though.
During their meetings with the registered companies, the regulators expressed their dislike for two things specifically: 1. Public blockchains, where anyone can access, read and write anything they like and 2. ICO related scams. Their main goal is to ensure any information that could potentially harm the national security and stability, does not spread on the internet through blockchain.
The message is clear: Companies should prefer private or enterprise blockchain rather than public blockchain.
Government Bodies As Clients
There is a big demand for blockchain projects among the local and provincial government bodies because almost every one of them want to use highly advanced technology such as ai, big data, cloud computing and blockchain. With more flexibility at local government level than at the private sector level, more and more companies are finding it easier to secure government projects.
According to one of the company representative, once you establish a solid relationship with the government body, business opportunities come, along with perks such as tax breaks!