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President Xi Jinping Endorses Developing Blockchain Technology in China

President Xi Jinping emphasized the development of blockchain technology and called for more research, investment, and regulations for it on October 24.

“Blockchain plays a core role in the next round of technological innovation and industrial transformation,” said Xi according to comments recorded by news agency Xinhua during a meeting with members of the Communist Party’s Central Committee Political Bureau.

Xi emphasized boosting research in blockchain in order to “help China stay on the frontline of theoretical, innovative and industrial aspects of blockchain and also occupy a seat in the global regulation-making process of the emerging technology.”

Xi said the technology should be expanded into other parts of people’s daily lives, like education, employment, health care, poverty alleviation, food safety, and other public services. “By using blockchain technology, the public are able to enjoy more convenient, intelligent and qualified public services,” he said.

Nonetheless, he said stronger measures should guide and regulate the development of blockchain technology, and the risk of using it should be researched and analyzed carefully.

Blockchain is an emerging technology much like an immutable ledger. It is a decentralized record that is hard to be altered and can track changes.

Following Xi’s comments, “blockchain” became a trending topic in various sectors, including online social networks. 

On Weibo, a Chinese microblogging service, the hashtag #blockchain was viewed 1.49 billion times. A blog from China’s state-run newspaper, People’s Daily, explaining blockchain, had been shared 11 thousand times. 

The price of Bitcoin jumped over 40% within a day, and blockchain-related companies also received substantial windfalls. Nasdaq-listed Xunlei, a Chinese software company that offers blockchain-based services saw its stock surge 107% the day after Xi’s comments — it was the company’s largest single-day gain since it went public in 2014.

However, Bitcoin — the best-known application of blockchain — was not mentioned in Xi’s comments. Instead, official talk surrounding a Central Bank backed digital currency ramped up. China is going to introduce its own digital currency, said Huang Qifan, the vice-chairman of the China Center for International Economic Exchanges, “The People’s Bank of China (PBOC) has been researching [the digital currency] for the past five to six years. The PBOC is probably the first central bank to introduce digital currency to the world.”