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Chinese Regulators Advise People not to Exaggerate Blockchain

Chinese Regulators Advise People Not To Exaggerate Blockchain

According to a local Chinese publication named South China Morning Post, the regulators are asking people not mythologize blockchain technology.

Fan Wenzhong, Director of international department China Banking Regulatory Commission, argued about the importance of the breakthrough technology at the 5th Fintech Bung Summit in Shanghai on July 8. He said that although the technology is innovative, yet it is too early to give it a godly status.

As per the director, blockchain cannot be considered as a revolution as the concept of multi-entry bookkeeping has been used for more than hundreds of years. He added, “Decentralization is not a new trend but a loop, because the earliest human transactions were without central authorities.”

In repetition to governments remarks over digital currencies, he said, “Blockchain is a useful innovation, but that doesn’t mean virtual currencies, which blockchain has given rise to, are necessarily useful.”

It should be noted that China has already adopted a harsh stance over virtual coins. The publication also reported that regulators had banned the access to 110 international crypto exchanges in May. Meanwhile, Police was able to bust almost 300 criminal cases in relation to cyber coins.

On the other hand, an analysis conducted by the Chinese government revealed that the blockchain project survived for only 1.22 years on an average and only eight percent of the blockchain projects are still operational.

The information was provided by He Baohong from the China Academy of Information and Communications Technology (CAICT) at the China International Big Data Industry Expo 2018 in Guizhou. The stats were part of the CAICT’s report on blockchain industry trends. The organization works directly under the guidance of the national government as the Ministry of Industry and Information Technology (MIIT). He added that it still a hit and miss environment for blockchain based products.

Despite the negative analysis, Xi Jinping, President of China, had compliments for the technology as part of the technological revolution. He added that the 21st century has met with technological and scientific innovation on a global scale which has increased to a monstrous level. “A new round of scientific and technological revolutions and industrial changes is reconstructing the global innovation map and reshaping the global economic structure.”

One should know that China is far ahead of many other countries in regard to blockchain adoption. If we look back into the days, many Chinese enterprises used the technology to make changes in their respective industries.  For example, the first blockchain based ship trade happened in the same country. Moreover, the highest number of blockchain patents are also from China. It hints about the number of people interested in making it into the new innovative space.

However, the country has banned crypto trading yet the most prominent blockchain miners also hail from China. Thus, the remarks made by the government official are a bit contradictory. But, again they might be disregarding things just like they have been doing in the past.

All in all, the statement should be taken with a grain of salt as things will probably won’t change anytime soon.