Sources tell DigFin that the people behind it are still debating what kind of infrastructure to use, as there is a preference for building off of a mainland Chinese tech stack.
This would scare off many potential users, particularly in light of the political tensions between the US and China. It’s hard to see a global bank placing sensitive data on such a network, so BSN’s job is to develop security measures that meet international expectations on privacy, security, intellectual property; in a word, trust.
However, enterprise blockchain developers can see that BSN is about to become the largest ecosystem in the world. Anyone who wants to be a part of, say, China’s international trade and investment flows will want to be BSN compliant.
The stakes are high for both China and global business if the BSN can thread this needle. Enter DCEP
Part of that involves trusting open source development. In this sense, the role of Digital Asset is the beginning of the internationalization of BSN. It’s also what sets China apart from other countries considering digital currency projects: It’s laying the groundwork for a global, compliant network of blockchains, which could emerge as a more efficient, transparent, fast, and cost-effective alternative to rails. existing financials.
This is where DCEP comes into play.
The People’s Bank of China has been testing it with big state-owned banks, telecommunications companies, and companies like Didi Chuxing, Meituan, Starbucks, and McDonalds.
In addition to the pilot in Huangzhou, there was also a trial of a blockchain-based credit scoring system that would track small and medium-sized businesses seeking financing from banks.
Blockchain in China
Blockchain has long been an admired technology within China, typified by its leader Xi Jinping’s direct promotion in October 2019. Even without Xi’s comments, China remains the leading nation in blockchain adoption with 45% of all projects coming from China according to data from the Mutual Chain Pulse Research Institute.
Major tech companies that have blockchain projects include Tencent, the company behind WeChat, Alibaba, through its Ant finance team, and Baidu, the internet search engine provider.
Provincial governments across the country have been implementing various blockchain projects.
The network will also promote research in other areas and seek to foster an ecology of development, according to the chairman of the BSN alliance, Liu Yunan.
Networks and Partner Organizations
The creation of the BSN has been carried out by a variety of familiar faces within the technology industry. Leading the investigation was the Chinese government think tank, the State Information Center (SIC), whose smart city development research group is the focus team. Other institutions that helped with its development include the telecommunications company ChinaMobile and China’s UnionPay payment/banking network.
In terms of the cryptocurrency industry, the Huobi exchange was a surprise inclusion in its development.
Technology behind BSN
The network will use a custom blockchain and there have been several companies involved in researching and implementing the technology.
The China Blockchain Service Network (BSN) is a national initiative designed to drive Blockchain integration and adoption in large enterprises. China has positioned itself as a leader in Blockchain development, with 45% of all blockchain projects coming from the nation’s tech giants and industries (such as the Tencent Blockchain Accelerator). The industry received a huge boost in October 2018 when President Xi Jinping expressed his admiration for the technology behind cryptocurrencies.
The network is set up for commercial use and seeks to provide a platform for businesses and individuals who wish to make a blockchain application. Blockchain technologies are extremely powerful for business applications as they enable large-scale data tracking with a guarantee of data authenticity.
News about the BSN has been circulating for over a year, and rigorous testing began 6 months ago.
The government revealed the entire system at a virtual press conference, taking precautions to prevent the spread of a highly contagious coronavirus. Official statements confirm that the launch and inner workings of the BSN were ordered by the authoritarian Chinese government.
Zhiguang Shan, president of the BSN Development Association, stated that the new system would act as a centerpiece for a variety of blockchain platforms. There are plans to integrate popular blockchain platforms such as WeBank’s FISCO BCOS, Baidu’s Xuperchain, EOS, Ethereum, and Hyperledger Fabric.
The BSN white paper stated:
“BSN’s primary goal has always been to create a public Internet-like infrastructure and provide a one-stop-style blockchain-based service that integrates cloud resources, the underlying frameworks. , operating environments, key management, development SDKs, and gateway APIs. Just like creating a simple website on the Internet, developers can implement and operate blockchain and distributed ledger applications conveniently and at extremely low cost.”
The BSN also aims to solve the problem of interoperability within a complex system, something that many other companies have tried to address in the past. This time, many officials in space were confident that the BSN could handle the situations.
China’s National Cryptocurrency Approaching
It’s unclear whether Chinese authorities intend to connect all of these networks, though it appears the nation’s blockchain ambitions are coming to a head in the form of the nation’s digital currency project. .
According to a report published by the South China Morning Post, the People’s Bank of China (PBOC) confirmed in a statement that “smooth progress” has been made in the development of the yuan digital currency.
Additional details were rather scant, though this comes on the heels of a report that Mu Changchun, the official in charge of China’s crypto asset development, said that “design, formulation, functional research, and high-level testing” have been completed. .
The PBOC is expected to launch a pilot project soon in the cities of Shenzhen and Suzhou, the former of which is the Chinese iteration of Silicon Valley.
On January 6, Baidu, a Chinese Internet and technology giant often called “Google of China” here in the West, unveiled its latest project: “Xuperchain,” a blockchain system for enterprises, which is now It is in beta version.
According to the translated version of a flashy new website outlining this new offering, this now-beta network will allow users, preferably smaller business operators, to build and deploy blockchain applications to help power their businesses.
Baidu said that the cost of this Xuperchain service can be as low as 1 yuan (or about $0.15) for the first few months.
Notably, Xuperchain has not launched at this time; the project has reportedly already been used by more than 3 million people and has processed 450 million transactions.
We have 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.
Along with the announcement of its Digital Currency Electronic Payment (DCEP) last month, China has also launched its Blockchain Service Network (BSN), signaling its continued shift towards a digital economy. Although not treated with as much fanfare, the BSN has a similar transformative effect as the DCEP and is no less important to industry inside and outside of China.
What is the China Blockchain Service Network (BSN)?
The Blockchain Service Network (BSN) is a platform created for individuals, businesses, and local governments on which they can build blockchain applications.
But, this is the first time that anyone in China can actually access this platform.
The Chinese company claims that it has partnered with the Beijing Internet Court, Renmin University of China, Tsinghua University, aiBank, TGood, and other notable Chinese entities to launch this project.
Not Only Chinese Corporation Going Blockchain
Baidu is not the only massive Chinese corporation that has started to dabble in blockchain of late.
One of the largest financial institutions in the region, the state-owned Bank of China, has used blockchain to issue bonds. According to an article on the Chinese business news site Sina Finance, the Bank recently completed the issuance of 20 billion yuan (about US$2.8 billion).
The network currently has 128 public nodes, most of which come from China, but a small number from abroad stretching across six continents
Pilot projects for BSN
The city where the network was tested was Hangzhou, in eastern China after the local government signed an agreement with the research group. According to Chinadaily, the BSN was implemented together with the city of Hangzhou. Brain Platform and will focus on improving e-government, hotel sanitization, and more individualized technology services. The system will also be used to track issues at the local level, such as road safety, and users will be encouraged to report any issues they see in the community.