Beijing Once Banned Bitcoin – Now It’s Made Blockchain Inevitable
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Two years ago, China banned crypto outright, leaving Web 3.0 companies blocking signups from Chinese users and fleeing the Middle Kingdom.
Now, Beijing may be responsible for quietly making Web 3.0 all but inevitable.
It was easy news to miss if you don’t speak Chinese or follow blockchain news ut on June 2, 2023, officials speaking at an industry forum released the ‘Beijing Internet 3.0 Innovation Development White Paper.’
The document outlined the capital city’s attempts to encourage consensus and development of the Web 3.0 industry, laying out technical needs behind the tech that Beijing officials believe will undergird generative artificial intelligence, content production tools, XR interaction terminals and other technologies.
To be clear, the People’s Bank of China hasn’t reversed its September 2021 ban on cryptocurrencies, which perhaps make up the most prominent use case of the blockchain for casual Web 3.0 users.
China has kept the 2021 ban, which led companies like Binance and Huobi to stop people with Chinese phone numbers from using their services.
For some crypto purists, the omission of digital currencies negates any sense of forward momentum.
Many in the space have mixed feelings about CBDCs (central bank digital currencies) like the ‘digital yuan’ that China has in the works, and it doesn’t take much for them to get up in arms.
Those skeptics are missing the point though.
While Chinese residents won’t be trading Bitcoin any time soon, the decision by Beijing and dozens of other cities across China to publish reports voicing support for blockchain technologies is a clear sign that they see Web 3.0 as critical infrastructure for the future internet.
In fact, the white paper calls Web 3.0 “the culmination of modern science and technology, and the inevitable trend of future internet industry development,” according to translations of the text posted by Zhao Changpeng, CEO of Binance, on Twitter this week.
This is what mass Web 3.0 adoption looks like. It’s piece by piece, brick by brick.
It’s critical validation for the underlying technology driving everything from cryptocurrencies and non-fungible tokens to digital ledger services and decentralized financial services.
Even countries with CBDCs have some benefits.
While government-regulated currencies artificially restrict competition, they will most likely give Web 3.0 users and app developers clearer understanding for what blockchain products they can build and use going forward, encouraging future growth of this essential internet infrastructure.
What’s more, it becomes even harder for crypto-skeptical nations to push off further investment in blockchain tech when some of the world’s most powerful nations are not just admitting its here to stay but also devoting more funds and research to the space even if Beijing’s promise to allocate 100 million yuan annually (roughly $14 million) is a relatively modest amount.
It’s no wonder then that Beijing’s ‘Internet 3.0’ white paper received major praise from Binance’s Changpeng, Huobi CEO Justin Sun and Animoca Brands co-founder Yat Siu, among other prominent Web 3.0 leaders.
More critical than the actual monetary investment is the signal it sends to the rest of the world Beijing’s support for Web 3.0 is a not-so-subtle nod to the nation’s support for Hong Kong’s new digital asset regulations, which went into effect on June 1, 2023.
Regardless of your personal geopolitical ties, it’s a well-understood fact that competition motivates nations.
China’s backing of blockchains makes it impossible for Western nations to completely opt out of Web 3.0 innovations, as doing so could put them at a severe competitive disadvantage.
That’s important, especially as the European Union continues its broadly restrictive stance toward Web 3.0 technologies, and the United States, despite being a hotbed for blockchain innovation, has increasingly cracked down on Web 3.0 companies while perhaps underestimating how empowering they can be with the right support.
Imagine how different the world would be today if the United States, after seeing the dot-com bust, had decided to crack down on internet infrastructure companies rather than continue developing them.
Web 3.0 has the potential to be every bit as transformative as the internet evolution humanity has seen over the last two decades and after Beijing’s announcement this week, no major nation will want to sit out and risk being left in the Web 3.0 ‘stone age.’
Imagine if the epicenter of Silicon Valley were in Guangzhou and not Palo Alto.
Jack O’Holleran is the co-founder and CEO of SKALE Labs the team behind SKALE, the world’s fastest blockchain, designed for ultra-fast, secure, user-centric Ethereum scaling. Jack is a veteran Silicon Valley Technology entrepreneur with a deep background in machine learning/AI technologies and blockchain.
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Author: Jack O’Holleran
