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China To Support Blockchain Development Under New Five-Year Plan

Last Updated March 4, 2021 4:53 PM
Lester Coleman
Last Updated March 4, 2021 4:53 PM

China, a country that already plays a critical role in cryptocurrency due to its dominance in bitcoin trading and mining, will support blockchain development as part of its recently-announced five-year plan, according to the state council website . The 13th Five-Year Plan (2016-2020) period has had a strong start and is poised to fulfill all key targets set by the central government for economic development.

According to the “13th Five-Year Plan” national information planning document, the “Thirteen Five” period is the stage for building a moderately prosperous society, with information and communication technology to provide a breakthrough in the initial development stage.

Profound Changes Coming

The document noted that the development of the global information technology environment, conditions, and content are undergoing profound changes.

“Internet, cloud computing, large data, artificial intelligence, machine learning, blockchain, bio-genetic engineering and other new technologies to drive cyberspace from everyone to the Internet to the evolution of everything, digital, network, intelligent services will be everywhere,” the document stated.

With the “real” and the digital worlds’ increasing convergence, the global governance system is facing profound changes. The global economy is expected to accelerate information technology innovation, the maximum release of the “digital dividend”, in response to a “post-financial crisis” era of “growth instability and uncertainty,” the document further noted.

Technologies Cited Include Blockchain

The document also noted “new technologies such as quantum communications, future networks, brain-like computing, artificial intelligence, holographic display, virtual reality, large data cognitive analysis, new non-volatile storage, unmanned vehicles, block chaining, gene editing, etc.” will build a new game-leading advantage.

The development of the “real economy” is based on both technology and financial innovation, meaning the capital market should be further improved to encourage more venture capital investment to boost the country’s entrepreneurship and innovation.

New modes like crowdsourcing and crowdfunding should be coordinated with mass entrepreneurship to boost innovation, the state council website stated.

Central Bank To Issue Digital Currency

China’s central bank, the People’s Bank of China (PBOC), announced earlier this year that it will make the necessary moves to work toward issuing a digital currency, as soon as possible, CCN.com reported.

A “special” research team put together by the PBOC was set up as early as 2014 to conduct research and look into all possible regulatory frameworks for the issuance of a nationwide digital currency and the impact it may have on the economy, the PBOC’s website noted.

The central bank engaged experts from Citibank and Deloitte to discuss the frameworks required for the issuance of national digital currency.

Some of the stated benefits include:

  • Reducing costs incurred during issuance and circulation of traditional fiat currencies.
  • An increase in the transparency and convenience of economic transactions
  • The curbing effect on tax evasion, money laundering, and other criminal acts.
  • Improve the central bank’s control over the money supply and circulation.
  • Breaking barriers to bring financial solutions for those unbanked in the country.

Some of the tasks set by the PBOC include the mandate of designing the proposed digital currency based on strong “economic, safety, and service principles.”

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