Chinese Government Embraces Blockchain Technology Despite Cryptocurrency Ban

China has launched a new national blockchain research center in its capital Beijing, boosting the development of the country's blockchain and Web3 industries.

The research center is endorsed by the Chinese Ministry of Science and Technology and will work with universities, tech companies, and other research institutes to train 500,000 blockchain professionals, South China Morning Post reported Sunday.

Blockchain technology has often been associated with digital assets, and the Chinese government took a tough stance on cryptocurrencies and banned crypto trading in 2021. Therefore, supporting the country's blockchain sector means separating the technology from its cryptocurrency use cases.

The newly-launched center aims to establish a nationwide blockchain network that will connect existing blockchains in China and promote cross-chain development. ChainMaker, also known as the Chang'An Chain, is one of the examples of Chinese blockchains that the center is looking to support.

ChainMaker is an open-source platform created by the Beijing Academy of Blockchain and Edge Computing, a government-backed research institute that is also taking a leading role in the new center. The State Grid, a Chinese state-owned electric utility corporation, is among the entities looking to realize the potential of the Chang'An Chain, hoping to use it to record carbon lifecycle data on-chain.

The Xiaotong Medical Chain is another project built using ChainMaker. The platform is designed to create trusted data links for medical institutions, government authorities and insurers to share information via a verifiable and cryptographically secured channel.

Despite the Chinese government's ban on crypto trading, the demand for cryptocurrencies remains strong among the Chinese population, and some digital asset firms have had to relocate their operations from mainland China to Hong Kong. Unlike Beijing, Hong Kong has created a crypto-friendly environment that has attracted some of the world's largest crypto firms, such as Huobi.

Although the Chinese government has taken a tough stance on cryptocurrencies, it continues to support the development of blockchain technology. The launch of the new national blockchain research center shows the Chinese government's commitment to furthering the country's blockchain and Web3 industries.

By training 500,000 blockchain professionals, China aims to maintain its leadership in the blockchain industry and solidify its position as a global technology powerhouse.