China Applies Blockchain in National Data Infrastructure

China is pushing ahead with the development of its national data infrastructure, with a focus on the application of blockchain technology. This ambitious target is set by the Chinese government by 2029.

According to an official announcement from the National Reform and Development Commission (NDRC), China's top economic planning agency, along with two other government agencies, China's data infrastructure is still in its infancy.

The construction of this data infrastructure is part of the government's master plan to create a unified national data market.

Despite maintaining a ban on cryptocurrency trading and mining, the Chinese government has shown support for other applications based on a licensed blockchain platform (permissioned blockchain). This type of blockchain does not use tokens and allows access control, in line with China's centralized management orientation.

According to the NDRC guidelines, blockchain will play a key role in the nation's data infrastructure. Specifically, China aims to build a standardized system for data assets and transaction certificates, using blockchain, encryption technology and smart contracts to “enhance traceability and reliability.”

The Chinese government will encourage industries and local governments to actively experiment with building new technological infrastructures, including blockchain networks and privacy-protecting computing platforms.

Zhulin Shen, deputy director of the National Data Management Agency, said at a news conference that data infrastructure development projects are expected to attract about 400 billion yuan ($54.5 billion) in direct investment each year, with total investment up to 2 trillion yuan ($272.7 billion) over the next five years.

The plan shows China's determination to apply blockchain to national data management and mining, towards the goal of building a strong digital economy.

The focus on licensed blockchains clearly demonstrates the Chinese government's desire for close control and supervision of this system.

To realize this goal, China needs to overcome many technical and legal challenges. Deploying blockchain on a large scale requires effective coordination between government agencies, businesses, and people.

China is making great strides in applying blockchain to socio-economic development. With massive investment and high determination, China is likely to become a pioneer in building blockchain-based national data infrastructure.