China’s Blockchain Service Network (BSN), a national blockchain platform, this week launched the first two open permissioned blockchains on BSN China, powered by Cosmos’ interoperable blockchain ecosystem in what is viewed as a highly significant milestone in China’s blockchain development.
The Tai’an Chain, named after the city of Tai’an in Shandong Province, and WenChang Chain are the first to join BSN’s Open Permissioned Blockchain (OPB) Initiative, where they will be able to leverage the public chain technology in BSN’s China portal in compliance with Chinese regulation.
The WenChang Chain — which takes its name from WenChang city in the new free trade zone of Hainan Province — is powered by Bianjie.AI, a Shanghai-based technology company that also developed IrisNet. Bianjie.AI is one of the public chain partners already integrated with BSN International.
Launched for commercial use in April last year, the BSN initiative aims to build a global blockchain-based cross-cloud, cross-portal and cross-framework public infrastructure network that can host global enterprises as they develop DApps in a cheap and convenient manner. It was split into two entities — BSN International and BSN China — in July.
The rationale for creating two entities was because public chains could only be in the BSN International portal. BSN China, which owns the majority of BSN’s city nodes across the mainland, has a separate system that follows Chinese strict regulations on blockchain. BSN is led by China’s State Information Center and backed by giant state-owned companies like China UnionPay, China Mobile and China Merchants Bank.
“China had been longing to embrace public chain technologies for years but there wasn’t an effective way to do so because the regulators are not a fan of cryptocurrency,” said Yifan He, executive director of BSN and CEO of Red Date Technology, which powers BSN, in a media statement.
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Cryptocurrency trading was once flourishing until 2017 when China started putting strict regulations on blockchain and effectively outlawed cryptocurrency trading and initial coin offerings. In 2019, China put its ICO ban in its draft banking law, which decrees that no entity or individual may produce or sell tokens, coupons and digital tokens to replace renminbi in circulation in the market or be used as renminbi substitutions circulating in the market.
However, BSN offers a regulation-compliant means to take advantage of the benefits of blockchain.
By refactoring the underlying technology of public chains, including Cosmos Hub and IRISnet, the WenChang Chain is able to comply with Chinese enterprise standards. This enables it to offer permissioned controls over node deployment and multi-level security management. The WenChang Chain is thereby able to provide a low-cost, user-friendly blockchain platform, and using interchain technology to provide interoperability between different private blockchains and to achieve invocation between smart contracts and off-chain data/computing.
“Industry leaders joined the BSN Open Permissioned Blockchain Initiative to promote the orderly development of public chain technologies in China in a legal and compliant manner,” said Harriet Cao, co-founder of Bianjie, in a media statement. “We are proud to be the first OPB to launch. In order for blockchain technology to play a greater role in empowering the real economy, the technology must adhere to regulatory standards.”
Yifan He said OPB will expand the BSN ecosystem and interact with other traditional permissioned frameworks and OPBs outside the system, taking BSN a step closer to its ambition of a “blockchain-based internet.”
“OPBs will form a unique landscape and become mainstream in China, and BSN is proudly leading this initiative,” He said, adding that he expects more public chains to participate in BSN in 2021, with IRISnet and Cosmos as drivers and standard-bearers.
The OPBs will be free of charge for developers for the first year. BSN is expected to add 20 to 30 more OPBs during the first quarter of 2021, all of which will be based on frameworks of internationally renowned public chains.