China Sets A $2 Billion Blockchain Development Plan

China used to critically acclaim the use of cryptocurrencies and the underlying blockchain technology. The diversion from anti to pro crypto has been visible throughout the past one year with the PBOC announcement of the release of their own cryptocurrency. China is even taking a step further with an investment plan exceeding $2 billion in total value, which will be used for blockchain development. All funds are planned to be allocated for technological advancements of the blockchain until 2023 year.

The main driver for the widespread adoption of the blockchain technology is the anticipated release of the yuan-backed government cryptocurrency. The launch is scheduled to take place in early 2020. Other sectors such as retail are scheduled for receiving a push by the Chinese government too.

Even China’s president Xi Jinping made an announcement, stating that China should be “at the top of the blockchain food-chain”. Shortly after Xi’s announcement, Chinese lawmakers in Hong Kong made new, streamlined licenses, and already used blockchain to increase the effectiveness of insurance claims.

The Chinese government even passed a law, which regulates the use of cryptocurrencies. The law describes the terms and conditions in using cryptography and password management, but also suggests the creation of a central bureau of cryptography – a crypto-specific regulatory agency, which will create policies and guidelines for the entire blockchain industry in China. The law will create the core of rules that will inform the People Bank of China’s yuan-backed digital currency.

Other countries are also jumping on the blockchain bandwagon, with Tunisia leading the pack of countries, issuing their own central bank digital currencies. Singapore adds more and more projects to its Sandbox accelerator program. The run by the Monetary Authority of Singapore accelerator provides a foundation for fintech startups and guides them in regulatory compliance. Malta is also stepping up its game to become the “blockchain island,” with companies shifting their operations into the small country.

The United States and other significant economic factors worldwide, however, are falling behind in the blockchain race, as regulators are struggling to find a clear path for crypto projects. China is working around the clock to be the first major economic force to utilize the blockchain-centric government approach, especially amid Facebook preparing its Libra stablecoin, which is a direct rival to China’s central bank-issued digital currency.