The People’s Bank of China (PBoC) has been more and more involved in the blockchain space as of late. However, the environment in China has not been all that friendly to crypto. From banning ICOs to stopping Bitcoin miners, the tendency for China to crackdown on crypto has been high.
Yet, despite all this, they have taken a keen interest in the blockchain space. This was made evident by a report which said that PBoC is planning to open a new digital currency research center.
Digital Currency Research Center
According to the report leaked by local news sources in China, PBoC is planning on building a digital currency research center in the capital of Jiangsu province. The center will include both academics and those in the financial sector, with the intention of piloting new programs that are aimed at demonstrating the many use-cases of blockchain technology. The scope of this center is evident by its co-founders: The Bank of Jaingsu and the University of Nanjing.
This all comes just a few months since another digital currency research lab was opened in Shenzhen. It is likely that these two centers are related and we can expect China to construct more of these in other Chinese regions as time goes on.
PBoC has taken an interest in blockchain technology due to its potential to disrupt existing economic models, especially the American dollar. Indeed, China seems quite dedicated to this new fintech development and is investing quite a bit into this burgeoning field.
For example, the digital currency center in Shenzhen is said to have a grant amount of $300,000 state from the PBoC which proves that the Chinese state is serious about blockchain technology.
Another aspect of all this, as reported by Coindesk, is that PBoC is working on new ways to algorithmically trade assets with the blockchain. This would mean a severe cut to their overhead costs and would effectively automate and verify much of the process. There is also evidence that China is applying this same technology to the existing fields of healthcare, transportation, and social organization more generally.
We can expect to see more investments in the crypto space from Chinese firms in the future – such as Alibaba and the like – who have already tried to utilize this technology for their existing financial and supply-based models.
Overall, despite their tacit disapproval of cryptocurrencies, it is clear that the Chinese government sees great potential in blockchain technology.