Boxmining

Category: China Crypto

News and updates about Cryptocurrency and Blockchain in China

  • Developing story: OKEx suspends withdrawals…but is there more to this?

    Developing story: OKEx suspends withdrawals…but is there more to this?

    What happened?

    On 16th October 2020 OKEx suddenly announced that one of their private key holders (later confirmed to be Star Xu, OK Group’s CEO and Co-founder) is cooperating with a “public security bureau” and is unable to contact them. Therefore the Exchange cannot complete authorisations for transactions and thus decided to suspend all withdrawals of digital assets/cryptocurrencies from 16th October 2020 at 11:00 (HKT).

    The Exchange did this under clause 8.1 of their Terms of Service which provides that, “8.1 Service Change and Interruption: We may change the Service and/or may also interrupt, suspend or terminate the service at anytime with or without prior notice.”

    In particular, their Terms of Service defines their “Services” as the services that OKEx offers through OKEx.com or its app. According to the Terms of Service, you must agree to be bound by it to use the Services, including of course their rights under clause 8. (Tramadol) 1 to suspend it at any time.

    This abrupt suspension has shocked the cryptocurrency community and caused prices of both Bitcoin and Ethereum to plunge. In particular prices for Bitcoin dipped from over USD$11,500 to USD$11,235 within a half-hour period. As of the time of writing, prices have still not yet fully recovered.

    Meanwhile, there are rumours circulating that there is more than what meets the eye and that this suspension was a cumulation of events that were already in motion a few days ago. Let’s take a look at some events today (16th October 2020) which may (or may not) be relevant to this:

    • 1:00a.m.: Twitter user @whale_alert tweets: 5,000 #BTC (57,033,847 USD) transferred from unknown wallet to #OKEx
    • 4:00a.m.: Twitter user @whale_alert tweets: 1,180 BTC (13,588,646 USD) transferred from OKEx to unknown wallet
    • 9:00a.m.: Twitter user @whale_alert tweets: 50,000,000 TRX (1,317,074 USD) transferred from OKEx to unknown wallet.
      11:55a.m.: Chinese crypto media platform 非小號 (Feixiaohao) and UAICOIN publishes notices from OKEx that withdrawals will be suspended from 3:00p.m. onwards. This was also reported in a tweet from Co-founder of Chinese crypto media outlet @redtheminer who also notes the rumours circulating in the Chinese crypto community that over 800 accounts from a “certain large crypto exchange” are involved in cross border money laundering.
    • 12:00p.m.: OKEx announcement that it would suspend withdrawals from 11:00a.m. onwards.
    • 1:00p.m.: OKEx finally tweets their announcement on the withdrawal suspension.
    • 2:00p.m.: OKEx CEO Jay Hao tweets, reassures that all other operations are unaffected and that, “The investigation concerns a certain private key holder’s personal issue only. Further announcements will be made.”
    • 2:51p.m.: Someone asks OKEx support “Why is Star Xu’s Weibo page emptied?” and they replied, “The person you are referring to has no relation to our platform”.
    • 3:51p.m.: Twitter user @whale_alert tweets: 998 BTC (11,333,911 USD) transferred from Huobi to OKEx.

    *All times are stated in HKT unless otherwise specified.

    What will happen to Star Xu?

    Based on the news so far, the speculation is that Xu was detained since around 9th October 2020.

    According to commentary from PRC lawyers, Xu who is in criminal detention would only be permitted to meet or communicate with his lawyers. This would mean that he cannot meet his family or other staff in OKEx to handle the situation at the Exchange.

    PRC lawyers have also commented that under Chinese Law, Xu can be held in detention for a maximum of 37 days (i.e. until 15th November 2020). After this, the People’s Procuratorate (i.e. the prosecuting authorities) will need to decide whether or not to approve an arrest. If an arrest is approved then Xu would continue to be detained pending trial. However, even if an arrest is not approved, if the authorities consider that further investigation is required then Xu may either be released on bail or subject to home detention. According to the PRC lawyers, if Xu’s family does not hear anything further on 15th November 2020 then it can be assumed that an arrest was approved.

    Updates from OKEx

    According to a further announcement on 6th November 2020, withdrawals are STILL suspended. They, however, do clarify that the “concerned party” is only “actively cooperating with a public security bureau in an investigation” and NOT arrested under criminal detention.

    In a new update, they do say that they have sought legal support and guidance and by doing this has “made contact with the concerned party”. OKEx has explicitly said they cannot disclose any further information. Notably the announcement does not say whether this will result in withdrawals being able to reopen.

    This does appear to be a step in the positive direction though, since according to the commentary from some Chinese lawyers a detained person is only permitted to meet with his own lawyers, rather than that of a company he is the CEO of.

    Nevertheless OKEx in its latest Twitter post continues to reassure affected users that there has been no withdrawals from the Exchange since 16th October 2020 and that 100% of funds can be withdrawn when withdrawals can be resumed.

    A few observations

    There are reports from Chinese media that Xu was in fact already taken in by Police for investigation a week ago, whilst 2 executives that were also detained have since been released on bail. His arrest is causing a stir because he holds the private keys to OKEx’s funds, and according to Glassnode’s data, OKEx holds around 200,000 BTC i.e. USD$2.3 billion worth of Bitcoin.

    There are reports that Xu was taken in for investigation in relation to matters unrelated to OKEx. In particular, it was in relation to funds he had borrowed from a Shanxi-based underground bank for the purposes of the backdoor listing of OKC Holdings on the Hong Kong Stock Exchange in 2019.

    We’ve already mentioned this in our previous newsletter about the KuCoin hack. Please take your cryptocurrencies off exchanges and store them offline in a hardware wallet. If you don’t have one yet, please consider getting one. Check out our Ledger Nano X review or buy it here.

    Withdrawals will resume on or before 27th November 2020

    On 19th November 2020, OKEx announced they would reopen unrestricted withdrawals on or before 27th November 2020. They will also be launching significant loyalty reward campaigns for their users as a show of gratitude to their community and for the inconvenience caused to them.

    We also note the announcement confirms that one of OKEx’s private key holders (likely to be Star Xu) has completed assisting investigation with authorities and has returned to his “normal business functions”. It is also confirmed that OKEx was not involved in any alleged wrongdoing or illegal activities. So for now we can all breathe a sigh of relief for Xu and OKEx.

    JUST IN: Details of OKEx loyalty programs released!

    As mentioned in the previous section, OKEx said they would launch loyalty programs for their users as a show to gratitude.

    On 24th November 2020, OKEx announced the following reward and compensation programs after withdrawals open on 27th November 2020.

    Users that made deposits, held tokens or traded during the withdrawal suspension period will be issued a one-time payment to users based on their assets and transaction conditions. The funds for this payment will come from 20% of OKEx’s total income from futures and perpetual swap transaction fees over the past 7 weeks which will be put into an incentive fund. The asset weight calculation will also be doubled for $OKB.

    Users with assets exceeding 10,000 USDT before 4:00pm UTC on 23rd November 2020 will have part of their service fees waived and refunded once withdrawals resume in the form of a rebate card valued between 100 to 1,000 USDT.

    For all users, there will be a Happy Friday Reward Program. This will start on 4th December 2020 and continue every Friday thereafter. To be eligible, users need to have daily average assets on OKEx or daily average trading volume greater than or equal to 100 USDT, and have KYC verification level 2 or higher. Users will get a BTC reward equivalent to OKEx’s futures and perpetual swap transaction fee income for that week * 10%* of the users daily average total asset value or trading volume (as the case may be)/ daily average asset values or daily average trading value of all users (as the case may be).

    Note that for the purposes of calculating the rewards, if a user’s daily average asset value exceeds 10,000 USDT, it would be calculated as 10,000 USDT. Similarly, if the user’s daily average trading volume exceeds 30,000 USDT, it would be deemed as 30,000 USDT.

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • Filecoin: What is it and why is it so popular in China?

    Filecoin: What is it and why is it so popular in China?

    Filecoin ($FIL) is created by Protocol Labs and aims to provide a real use case for blockchain technology outside of finance. As the name suggests, it’s all about files. But, since the system is decentralized, how does it guarantee security and availability? Also, are those storing files paid? Here, we look at what Filecoin is, plus the reasons why it has become quite a sensation in China.

    Summary

    • Filecoin is a decentralised file storage network. Users pay for their files to be stored whilst those that help with storage are rewarded with $FIL tokens.
    • The project raised USD$200 million in its Initial Coin Offering (ICO) in 2017. Mainnet launch will be around 3:00pm (UTC) on 15th October 2020.
    • Filecoin has already been on the Chinese radar since 2018 where Chinese firms have started marketing Filecoin cloud mining services. It is considered easier to mine because specialised mining devices are not required.
    • Filecoin is also popular in China because of speculation on the price of $FIL tokens. Some exchanges already offer $FIL trading on an IOU basis.

    What is Filecoin ($FIL)?

    Filecoin is a decentralised file storing network that rewards users who store files. Those who keep files are referred to as storage miners. Users pay for their files to be stored while storage miners are rewarded for their work.

    Its distributed nature allows for peer-to-peer file storage and retrieval design. The platform has a native virtual currency called FIL, which is used to reward miners.

    The network is inspired by Web3, an advanced software development architecture that eliminates centralization. Filecoin can provide file storage services to other decentralized platforms as well. Furthermore, the network projects a way to enable transaction interaction with other blockchain platforms promoting interoperability.

    What is Filecoin Token $FIL?

    Filecoin token $FIL is the platform’s native virtual currency which is used to reward miners. Note that Filecoin mainnet has not launched yet and FIL tokens are not in circulation. However, as will be seen below a few exchanges are already trading FIL on an IOU basis. This means that users will only receive FIL tokens in the future. However, this has not deterred enthusiasts, with FIL having more than USD$100 million in trading volume every 24 hours and prices seemingly on an upward trajectory.

    Upon the Filecoin mainnet launch (see below), Huobi Global will launch $FIL and open trading, deposits and withdrawals. Other exchanges have also rushed to list one of the most talked-about Chinese projects since 2017 such as Binance and FTX exchanges.

    Filecoin Mainnet Launch

    Protocol Labs spearheaded the project’s ICO in 2017. Backed by top names in venture capital like Sequoia and Andreessen Horowitz, $200 million was raised.

    The ICO was followed by testnet postponement until 2019. Protocol Labs initially promised the mainnet launch in the first quarter of 2020.

    Filecoin mainnet has now launched at epoch 148,888- at around 3:00pm (UTC) on 15th October 2020. You can check the status of the chain here.

    How Filecoin works

    For users

    Users on the platform are charged for file storage. However, storage charges vary depending on whether a user chooses speed over redundancy and vice versa. Also, storage prices are affected by availability and demand.

    For storage miners/providers

    On the Filecoin protocol, a storage provider can either be an individual or an organization. And the only criteria for becoming a miner is having a free hard disk space and an internet connection. Miners will also have access to the entire pool of Filecoin users.

    For smooth usage, the network provides a standard application programming interface for miners and advertises their availability. Without individual marketing, storage providers rely on speed, storage space, and reliability to woe users and attract rewards.

    Filecoin has a self-healing feature that automatically checks if files on the blockchain are stored correctly. Additionally, the feature enables the network to detect faulty miners and their loads to be distributed to other miners.

    The process of self-healing generates tracks showing a miner’s history on the network. A good reputation earns them more storage opportunities hence more rewards. The system uses proof-of-file and proof-of-storage mechanisms that are not energy-intensive, like the proof-of-work mechanism employed by Bitcoin (BTC).

    Apart from general storage miners, there are also retrieval miners. These type of miners need to have a strong internet connection as they pre-fetch the most downloaded files and deliver them to users who are in close proximity. Afterward, they are rewarded for facilitating a smooth traffic flow on the network.

    China is all-in on Filecoin

    Miners are seriously considering Filecoin

    Although the protocol does not require specialized mining devices for access, China is eyeing developing Filecoin mining hardware. Furthermore, Chinese investors are already speculating on FIL’s price. In fact, the Chinese have already been into Filecoin since as early as 2018, and with the mainnet launch being potentially weeks away, the hype is only getting stronger.

    For example, when Protocol Labs announced an incentive program in early June 2020, Chinese firms started marketing cloud mining services that users can contract and use to provide storage to Filecoin users.

    With the popularity of cryptocurrency mining in China, it is not surprising that these firms attracted a minimum of $500,000 in sales in the first few days. In addition, data from blockchain explorers revealed that the leading storage miners on Filecoin are located in China. Cumulatively, these miners account for over 80 percent of the network’s testnet storage mining power at roughly 15 petabytes (15,000 terabytes).

    However, the tremendous uptake of storage mining in the Asian country can be attributed to the country’s love for Bitcoin and other cryptocurrency mining activities. Although Bitcoin trading is banned in China, most of Bitcoin’s mining power is still concentrated in the country at approximately 65 percent.

    Also, even before Filecoin went live, mining hardware companies were already hyping their products in anticipation. Andy Tian, the co-founder of 1475, a hardware manufacturing company, thinks that China’s Filecoin mining hype is partly driven by the fact that the idea behind the mining is simpler to retail miners compared to mining BTC where ASICs are used.

    The anticipation in China is so high that more than $15 million worth of Filecoin mining software and hardware has been stashed by mining pools waiting for investors and self-mining. Other large BTC mining companies like RRMine reportedly sold $15 million in cloud computing contracts “within minutes.” RRMine is also accumulating FIL mining hardware.

    Unfortunately, it’s not the amount of free space you provide to the network that matters more, but the amount of sealed data. While accessing the FIL protocol does not require massive processing power, sealing data on a hard drive does.

    The sealing can be done by harnessing power from a CPU or a GPU hardware. However, throwing a piece of specialized equipment in the mix makes it faster, allowing miners to seal more data in a day. In return, they also get more rewards.

    Chinese Companies are also speculating on Filecoin

    But it does not stop at mining. Close to 50 cryptocurrency exchanges in the Southeastern Asian country, including Biki Exchange and MXC Exchange, have FIL futures served with Tether (USDT) on their menu. Note however that this is only an IOU, as the token hasn’t actually been released yet.

    Cryptocurrency data aggregator platforms like CoinMarketCap, Feixiaohao, recorded roughly $100 million in trading volume in 24 hours. The price of Filecoin futures, however, has been fluctuating from $11 to $28 to $18 within days.

    Some firms dealing in cloud contracts, e.g., Mars Finance, project a 300 percent annual return for FIL miners without providing the amount of FIL tokens each terabyte of contracted space can bring.

    Conclusion

    Although the mainnet and the rules governing storage mining are yet to be released, the Chinese community has long gravitated towards Filecoin. Some of the reasons behind this craze can be because of China’s uneven domestic investment landscape that has alienated middle-class individuals looking for attractive investment opportunities.

    Also, China’s rigid stand on capital controls has led Chinese investors to seek reputable cryptocurrency or blockchain-based projects that can facilitate financial interaction with the rest of the world. Filecoin’s association with leading venture capital firms makes it attractive to the Chinese community. Also, its storage mining tag makes it simple for retail miners and investors.

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • China’s Cosmos and ChainLink Plan

    China’s Cosmos and ChainLink Plan

    China has asked for guidance from the teams behind Cosmos and ChainLink for their Blockchain Service Network (BSN), it was revealed last month. Researchers have called upon both companies to aid their development of the BSN, which was launched alongside their Digital Currency Electronic Payment (DCEP) in April 2020, to help them build out a “service hub” which would form the bedrock of its “internet of blockchains.”

    Learn more about ChainLink ($LINK).

    SmartContract and Iris Foundation join BSN Development

    According to reports, SmartContract, the group behind the Chainlink oracle network, will aid the BSN team in the sourcing of reliable information. Their Dapp services, potentially on Hyperledger, could allow for a cohesive and more streamline to access information. 

    Yifan He, BSN expert and CEO of Beijing Red Date Technology, spoke on the ChainLink addition, saying the partnership between the two, will give access to outside data from many Chinese companies, such as financial transaction information from China Union Pay, something difficult to obtain and analyze in the first place. This would then allow for BSN users to access “outside data such as stock prices and financial transactions.”

    On the other hand, Iris Foundation Ltd., the company who uses the Cosmos network to integrate businesses using interchain services, will work on interoperability for the network. He described their addition as allowing for “cross-chain services between blockchains adapted in the network.”

    Both companies appear to know what the State Information Center and China Mobile/China Union Pay backed BSN needs in their attempts to create a worldwide blockchain infrastructure. 

    And it seems they have a good chance of pulling it off as the government backing allows greater alliances and interconnectivity between the important players. One of these players and a team that looks integral to the future research is ChainLink. 

    ChainLink suits BSN

    The chance to be part of a huge project was something ChainLink’s co founder and SmartContract CEO Sergey Nazarov, couldn’t miss. Explaining how the BSN might use his company, the co-founder said: “Chainlink provides the blockchain abstraction layer or secure blockchain middleware that enable dapp developers to create universally connected smart contracts.” 

    Google, through its Google Cloud uses ChainLink for a similar function as he BSN, Nazarov explained. “What BSN really cares about, much like the people we’ve worked with from Google, is this type of contract that allows blockchains to access external off-chain data,” Nazarov stated. 

    The need is made even greater as blockchain can’t be directly applied to application programming interfaces (APIs) and only universally connected smart contracts can create the connection and allow for off chain data. 

    This use case is especially needed, Nazarov claimed, for global financial product or insurance, as the contracts must have external data and ensure goods and services are delivered, which needs the universally connected contracts.

    The usage of ChainLink and their services are set to continue as Nazarov told CoinDesk, “Chainlink’s technology suits BSN’s vision because the network includes multiple chains that are also supported by (his) team.”

    BSN starts to build for future

    Since its launch in April, the BSN has been announcing a number of partnerships with experts in the blockchain field. For example, around the initial launch the research team confirmed the plans to adapt Ethereum and EOS public blockchains into the BSN system.

    A target area has been cross chain services with Polkadot one of a number of companies earmarked for positions on the interchain service. “We plan to have at least four different interchain service technical frameworks developers can choose from in the hub,” He said. 

    “The interchain service hub is one of the three critical parts for the national blockchain infrastructure”, He continued adding that enterprise and public blockchains into the network were the other key fields. 

    Despite not being finalised, the network is already proving popular. ”We have been on-boarding two to three public chains every month on average, while adapting consortium chains at a slower pace since it usually takes longer to integrate them with the network,” He claimed. 

    However, not all blockchain developers  are pleased with the creation of the network, with some developers worried about their data being stolen as well as other privacy concerns. The BSN looked to quell the fears in their recent technical white paper, but there is cause for concern considering the nations stringent Internet laws. 

    Decentralised Finance (DeFi) series: tutorials, guides and more

    With content for both beginners and more advanced users, check out our YouTube DeFi series containing tutorials on the ESSENTIAL TOOLS you need for trading in the DeFi space e.g. MetaMask and Uniswap. As well as a deep dive into popular DeFi topics such as decentralized exchanges, borrowing-lending platforms and NFT marketplaces

    The DeFi series on this website also covers topics not explored on YouTube. For an introduction on what is DeFi, check out Decentralized Finance (DeFi) Overview: A guide to the HOTTEST trend in cryptocurrency

    Tutorials and guides for the ESSENTIAL DEFI TOOLS:

    More videos and articles are coming soon as part of our DeFi series, so be sure to SUBSCRIBE to our Youtube channel so you can be notified as soon as they come out!

    Disclaimer: Cryptocurrency trading involves significant risks and may result in the loss of your capital. You should carefully consider whether trading cryptocurrencies is right for you in light of your financial condition and ability to bear financial risks. Cryptocurrency prices are highly volatile and can fluctuate widely in a short period of time. As such, trading cryptocurrencies may not be suitable for everyone. Additionally, storing cryptocurrencies on a centralized exchange carries inherent risks, including the potential for loss due to hacking, exchange collapse, or other security breaches. We strongly advise that you seek independent professional advice before engaging in any cryptocurrency trading activities and carefully consider the security measures in place when choosing or storing your cryptocurrencies on a cryptocurrency exchange.

  • China’s Blockchain Service Network (BSN) Guide

    China’s Blockchain Service Network (BSN) Guide

    China’s Blockchain Service Network (BSN) is a national initiative designed to boost the integration and adoption of Blockchain in big businesses. China has positioned herself as a leader in Blockchain development, with 45% of all blockchain projects coming from the nation’s industries and tech giants (such as Tencent’s Blockchain Accelerator). The industry was given a huge boost in October 2018 when President Xi Jinping voiced his admiration for the technology behind cryptocurrencies. The network is set up for commercial usage and looks to provide a platform for enterprises and individuals wishing to make a blockchain application. Blockchain technologies are extremely powerful for enterprise applications as it allows for large scale data tracking with a guarantee on the authenticity of data. We’ve seen enterprise-focused Blockchain projects gain major partnerships in the past, such as Vechain’s partnership with logistics company DNV GL and auditing firms PwC.

    Xi Jinping
    President Xi personally addressed the nation on Blockchain Development in 2019

    Alongside the announcement of its digital currency electronic payment (DCEP) last month, China also launched its blockchain service network (BSN) signaling its continued shift towards a digital economy. Although it was not treated with as much fanfare, the BSN has a similar transformative effect to the DCEP and is no less important for the industry within and outside of China.

    What is China’s Blockchain Services Network (BSN)?

    The Blockchain Service Network (BSN) is a platform set up for individuals, businesses and local governments on which they can build blockchain applications. Launched on April 25th, the main target of the public network is to create a one-stop-shop for blockchain in China which supports smart city initiatives, other public networks and regions in the imminent digital economy which the People’s Republic is building. 

    The network will have two primary functions. The first is commercial and this will allow businesses/blockchain startups to use the network to develop applications, offering a public alternative to the private blockchain networks which already exist. Alongside this, the BSN will also provide a foundational consortium chain alliance for use for smart cities and digital economies. According to reports, the network will focus on openness, public utility, scalability, open-source, multi-portal, low cost and autonomy.

    The initiative will also be integral for the research into government usages for blockchain and governance. The network will also promote research in other areas and look to foster a development ecology, according to BSN alliance President Liu Yunan. 

    Liu Yunan BSN President (source:SIC.com)

    Partner Networks and Organisations

    The creation of the BSN has been done by an array of familiar faces within the tech industry. Leading the research was the Chinese government think tank, the State Information Center (SIC) whose smart city development research group the focal team. Other institutions which helped with its development include telecom company ChinaMobile and banking/payment network, China’s UnionPay. In terms of the cryptocurrency industry, exchange Huobi was a surprise inclusion in its development. 

    List of some BSN development association members (Source: CoinTelegraph)

    Technology Behind the BSN 

    The network will use a custom-built blockchain and there have been a number of companies involved in the technology’s research and implementation. The leading group in its creation is FISCO, or Financial Blockchain Shenzhen Consortium. This group includes Tencent’s digital currency wallet Webank and Cloud, Huawei, and Shenzhen Securities Communication.

    FISCO- BCOS 

    FISCO created the BCOS open-source network. Based on Ethereum’s blockchain, BCOS uses various features like zero-knowledge proofs and allows individual permissioned chains to run concurrently. 

    Tencent has played an integral role in its development, with its digital bank, Webank, providing smart contract Digital Asset Modeling Language for FISCO BCOS. 

    The network has already shown itself to be popular in its initial Beta period which began six months ago. Reports have suggested that 2,000 developers had signed up to the test period, creating blockchain applications for public welfare charity and electronic invoices. 

    Both the DCEP project and the BSN are all key structures in China’s technological plan, called the “China Standards 2035”. The document, which is set for release later this year, will plot out how the technologies will shape the next decade. 

    The BSN Beta testing

    The initial testing plan was launched in October 2019 and ended recently prior to the April launch. According to local media reports, the beta testing for commercial usage went well. Around 2,000 developers joined up with the test period, creating blockchain applications for public welfare charity and electronic invoices. Currently, the network has 128 public nodes, of which the majority come from China but a small number are overseas stretching across six continents. 

    Pilot Projects for BSN

    Huangzhou was the pilot city for the BSN

    The city which the network was tested in was Hangzhou, in Eastern China after the local government signed an agreement with the research group. According to Chinadaily, the BSN was rolled out in conjunction with Hangzhou’s City Brain platform and focussed on e-governance improvement, disinfection for hotels and more individualised technological services. The system will also be used to track local level issues such as road safety, with users encouraged to report any issues they see in the community. 

    As well as the piloting in Huangzhou, there was also a trial for a credit rating system based on blockchain that would track small and medium-sized businesses who wished to gain finance from banks.

    Blockchain in China

    Blockchain has long been a technology admired within China, typified by their leader Xi Jinping’s direct promotion of it in October 2019. Even without Xi’s comments, China has still been the leading nation for blockchain adoption with 45% of all projects coming from China according to data from the Mutual Chain Pulse Research Institute.

    Mutual Chain Research graph on number of blockchain projects by nation

    Top tech companies that have blockchain projects include, Tencent, the company behind WeChat, Alibaba, through its Ant financial team and Baidu, the internet search engine provider. 

    Provincial governments across the nation have been implementing various blockchain projects. More recently though, the shift has been more national with Blockbeats reports from May 12th claiming that the Ministry of Human Resources and Social Security of China is looking for 10 new roles with regards to blockchain, these include Blockchain Engineering Technicians and a Blockchain Application Operator.

    WIll the BSN and DCEP be linked?

    Although there is nothing concrete at the moment, it would appear that both the DCEP and BSN will be linked. Evidence for this comes from reports of Webank writing smart contract digital asset modeling language. Clearly though, both blockchain and a digital yuan are integral parts of China’s future, something which will be enshrined in writing within the China 2035 Standards document set for release later this year. The document is a fifteen-year plan for China’s development and blockchain/digital currencies will be an integral part.