The publisher of the Communist Party-affiliated newspaper, People’s Daily, has published a blockchain guide called Blockchain—a Guide for Officials, the state-run paper announced earlier this week. The book appears to have gone online (link in Chinese) last month, and is aimed at helping top Communist officials better understand a technology that the party seems pretty excited about, as long as it can control it.
According to a description on Chinese e-commerce site JD.com (link in Chinese), the book is compiled of around 20 articles previously published in state-run media such as People’s Daily, Economic Daily, and Guang Ming Daily, written by entrepreneurs, heads of financial media groups, and blockchain experts. The articles explain the potential and possible applications of blockchain in finance, along with challenges that the government faces in regulating the industry. Introductory pieces, such as “Blockchain: a Turning Point in the Internet World” (link in Chinese) and “Application of Blockchain Technology in the Age of Internet” (link in Chinese) describe blockchain as a transparent platform where people trust each other and trade under rules fixed by everyone.
The book might end up sending mixed messages to party members used to rigid, top-down hierarchies. Hewing to the standard description of blockchain technology, the articles promote it as a decentralized ledger that empowers regular people. “Blockchain’s significance… is seeking to achieve consensus as a way to govern a community,” wrote Ye Zhenzhen, head of People’s Daily Online, in the book. But the Communist Party isn’t all that fond of decentralization and public participation.
While Chinese president Xi Jinping has officially endorsed blockchain as a technology that will “deeply affect fate of the country,” Beijing banned cryptocurrency trading and ICOs last year, and then went on to crack down on bitcoin mining early this year.
“I think it became a bit out of control organically,” said Jehan Chu, founder of Hong Kong-based Kenetic Capital, a cryptocurrency investment and advisory firm. “This is China’s way of resetting… they want to clean it up, organize it, have the correct licensing.”
China’s approach became clearer in an hour-long show about blockchain aired on government-backed broadcaster China Central Television in June, when a senior official said:
When talking about blockchain, many people are talking about “decentralization.” I’d like to make a small change to the word. I think the essence of blockchain is “de-intermediarization.” There is no way to get rid of the center.
Instead of millennial entrepreneurs, it’s the People’s Bank of China that will take the lead on cryptocurrency, and might well become one of the first major central banks to issue its own digital currency. China’s authorities have also discussed (link in Chinese) setting up a blockchain regulator to supervise the industry. In other words, the Chinese government wants to harness the power of blockchain technology, as long as it’s blockchain with Chinese characteristics. This notion rejects many of the fundamental ideas associated with blockchain and cryptocurrencies.
“They want to do what they with the internet—regulate it, and have their own version which they can control,” said Chu.