China unveils breakthrough blockchain infrastructure for Belt and Road project

China unveils breakthrough blockchain infrastructure for Belt and Road project

China on April 1 announced a groundbreaking initiative led by Conflux Network – the “Ultra-Large Scale Blockchain Infrastructure Platform for the Belt and Road Initiative.” The aim of this initiative is to enable seamless and secure cross-border transactions using blockchain technology. The meeting to introduce and implement the national research and development project “Ultra-large-scale Blockchain Basic Platform for the Belt and Road” took place on March 30. This initiative, led by the Shanghai Shutu Blockchain Research Institute, is supported by renowned institutions such as the China Academy of Information and Communications Technology and various universities.

The initiative aims to develop a blockchain platform that meets the requirements and peculiarities of transnational cooperation along the Belt and Road Initiative. It is intended to create a basis for the development of applications in the areas of business, trade and culture. The Conflux Network plays a crucial role in this and has already successfully carried out beta testing for the Hong Kong dollar (HKD)-backed stablecoin AxHKD.

Although the Chinese government has taken a tough stance on cryptocurrencies, the country's new blockchain initiative shows interest in the technology. Chinese investors are increasingly using the cryptocurrency market as a safer alternative in economically turbulent times. Despite the regulatory measures, there is a thriving crypto industry with Chinese investors finding creative ways to participate in cryptocurrency trading.

Impact and context

The “Ultra-Large Scale Blockchain Infrastructure Platform for the Belt and Road Initiative” is a significant project that could help China strengthen its trade and economic ties. The use of blockchain technology makes it possible to process cross-border transactions seamlessly and securely. This could help overcome trade barriers and bureaucratic hurdles that often make international business difficult.

The initiative is supported by renowned institutions such as China Academy of Information and Communications Technology, Shanghai Jiao Tong University and other key entities. This suggests that the project has broad academic and institutional support and has a good chance of success.

Conflux Network’s role in this initiative is also notable. Conflux Network has already successfully completed beta testing for the AxHKD stablecoin and is recognized as the only regulated public blockchain in China. This shows that Conflux Network has already tested its blockchain technology in practice and is ready to play a significant role in the implementation of the Belt and Road Initiative.

Although China has a hawkish stance on cryptocurrencies, the interest in blockchain technology shows that the country recognizes the benefits of this technology and wants to take advantage of it. However, it is important to note that the Chinese government remains skeptical about cryptocurrencies and heavily regulates cryptocurrency trading.

Despite the bans and regulations, Chinese investors have become increasingly interested in cryptocurrencies. They are seeking alternative ways to participate in cryptocurrency trading, including using centralized platforms and trading abroad. This has led to a thriving underground cryptocurrency market in China.

The growing importance of the Chinese crypto market is reflected in the increase in trading volume in the peer-to-peer sector. China has improved in the global ranking of peer-to-peer trading volume from 144th in 2022 to 13th in 2023. This shows that despite the Chinese government's restrictive measures, interest in cryptocurrencies remains strong in China.

Chinese technology giants such as Tencent and Huawei are also active in the Web3 industry and support Web3 startups. Although cryptocurrency trading is banned in China, these companies are using their resources to advance the development of Web3 technology.

Overall, China's new blockchain initiative demonstrates the country's interest in blockchain technology and its intention to use it to strengthen its economic and trade ties. Despite the hawkish stance on cryptocurrencies, Chinese investors are recognizing the benefits of the crypto market and are looking for ways to participate in it. Developments in China are also impacting the global crypto market as China has become a major player in peer-to-peer trading.