RWR Report: China’s State-backed Blockchain Platform
On June 29, RWR Advisory Group published a new report, entitled, “The Emergence of China’s State-Backed Blockchain Platform” that is authored by RWR’s Sreya Vaidyanathan and Andrew Davenport. The report highlights the development of the Blockchain-based Service Network (BSN) and its role in China’s efforts to ensure that Chinese companies are front-and-center in the standardization and interoperability of blockchain-based global digital infrastructure. This effort is a new point of emphasis for China within the framework of the Digital Silk Road.
Beijing perceives its success in this endeavor as crucial not only to ensuring its long-term economic competitiveness in the global technology sector, but also to persuading foreign countries to adopt its norms for governing the internet and digital space more broadly. One important way that China is seeking to achieve this objective is through BSN, a state-backed blockchain system that Beijing is expanding both at home and abroad.
If leveraged effectively, the adoption of Chinese blockchain infrastructure could foreseeably allow China to integrate – and hold influence over – many of the core cross-sector digital solutions being implemented by Chinese companies around the world from financial technology (fintech) to smart logistics to new supply chain management solutions.
The objective of the People’s Republic of China to proliferate blockchain infrastructure to foreign countries thus raises national security and strategic considerations for the United States and its allies (as well as the target countries themselves). Indeed, Chinese blockchain solutions represent another dimension of how Beijing intends to enhance its leadership and influence over the global digital economy, facilitated by state-owned or state-controlled enterprises operating abroad that are increasingly raising concerns about their susceptibility to being used by the CCP for espionage or other strategic purposes.