In a notice Wednesday, Chinese regulators gave their blessing to 179 blockchain pilots proposed by companies and government agencies that include JD.com, Haier, and SAIC-GM-Wuling. Each entity listed was given the green light to apply blockchain technology to a specific field in a trial initiative.
Major companies listed included Jingdong Technology Information Ltd., a subsidiary of e-commerce giant JD.com; Haier Refrigerator, a subsidiary of Haier Group Corporation; and SAIC-GM-Wuling, maker of one of the best-selling electric vehicles in China, the mini Wuling Hongguang. All were approved to conduct trials by using the novel technology in manufacturing.
None of the leading group of tech companies known as the “BATs” — Baidu, Alibaba, and Tencent — appeared on the list, nor did ByteDance, the parent company of TikTok.
Last year, the Alibaba-affiliated fintech giant Ant Group launched a blockchain subsidiary, and Alibaba, Tencent, and JD have all entered the blockchain-powered non-fungible token market.
The pilots are assigned to geographic areas, will run until the end of 2023, and aim to create “duplicable” case studies and experience to help build China’s digital networks, according to a policy document authorizing the pilots. It is the first time national authorities have authorized trial use of blockchain, a decentralized digital ledger, on a national level. Inclusion is likely a stamp of approval from the top regulators.
Other areas of application mentioned in the list include energy, education, health, judicial affairs, intellectual property rights, trade and finance, risk management, equity market, and cross-border finance. The tax bureaus of the eastern Jiangsu and Jiangxi provinces were authorized to use blockchain in tax services.
JD.com declined to answer Sixth Tone’s questions about its future plans. Neither Haier nor SAIC-GM-Wuling responded to requests for comments by the time of publication.
Of the three types of blockchain — public, private, and consortium — Chinese developers have focused on “key technological developments of consortium blockchain,” Cai Liang, head of the Zhejiang Province Blockchain Technology Research Center, told the Beijing News last October. Compared to public blockchain, which is wholly decentralized, a consortium blockchain is governed by its creators.
While China is promoting blockchain development, it has largely banned work on cryptocurrencies, the most famous application of the technology. Regulators prohibited initial coin offerings in 2017, and China’s central bank banned all cryptocurrency transactions this September, writing that it “endangers the safety of people’s assets.”
Wednesday’s notice came with a warning against crypto activity and over-hyping technology. “Companies and regions should abide by the principle of honesty and credibility, falsification is strictly prohibited, as is hyping up cryptocurrencies, mining, illegal fund-raising, money laundering, pyramid schemes, and media hype in the name of blockchain innovation,” read the notice issued by China’s 17 highest-level regulators, including the Cyberspace Administration and the People’s Bank of China.
Since President Xi Jinping endorsed blockchain in 2019, provincial and local governments have competed to attract blockchain companies. Beijing announced plans to become a blockchain hub last June, while the southern Hainan province vowed to implement the technology in sectors such as housing, health care, and tourism.
Since February of 2019, companies with blockchain services have needed to obtain a permit from the Cyberspace Administration for governance purposes, according to Regulations on the Management of Blockchain Information Services.
Editor: David Cohen.
(Header image: Vectorstock/People Visual)