It’s full speed ahead as far as China and blockchain technology is concerned, as the intersection between the innovative technology and the country’s financial space continues to grow.
Earlier this month, local news source Sina Finance reported that the Bank of China has issued up to 20 billion yuan ($2.8 billion) in blockchain-based bonds for both micro and small enterprises across the country. The funds will be used to issue loans to these companies, thus helping them to expand their operation and scale.
Applying Blockchain as the Government Wants It
The development is in direct obedience to a directive by Chinese President Xi Jinping. In October, the president sent a massive bombshell across the crypto space, when he came out to support blockchain technology and spurred entities- whether public or private- to adopt the technology as well.
As President Xi put it at the time, blockchain will be able to help the Chinese economy to grow, thus keeping the country on pace to achieve both technological and economic advancement. While a lot of agencies have answered the call and are adopting blockchain en masse, this is truly one of the adoption techniques that will see the vision of the president come to life.
By being able to access loans, small and micro enterprises will be able to keep their operations optimal, accessing various markets for the resources they need. It’s blockchain-fueled economic growth at its fundamental level.
China’s Crypto Nears Its Launch
Of course, all of this is still leading up to the launch of digital currency by the Chinese government. Beijing has been rumored to be launching a cryptocurrency anytime soon, and reports are beginning to surface concerning what the asset could be like and how it could operate.
Earlier this week, local news medium Caijing reported that the Peoples Bank of China- the country’s Central Bank- will be leading other major banks and economic participants in the country to conduct real-world tests of the asset.
According to the report, the agencies will be testing the digital currency in the city of Shenzhen before the year winds to a close, and there is a possibility of expanding this to the province of Suzhou as well.
On December 5, news source Global Times reported that Yang Wang, a senior research fellow with the Fintech Institute of Renmin University of China, had explained that the new national digital currency would be able to process up to 220,000 transactions in a second. While speaking on the potential of the asset to onboard billions of people in the first phase of its adoption, Wang reportedly made the estimate, adding that its mass adoption will be unstoppable once people begin to see the speed and superiority of the asset over other fiat currencies and digital assets.
Although the estimate hasn’t been confirmed by anyone with access to the Chinese government, it will definitely make the Chinese asset more of a reliable option or making payments or transfers. Currently, Bitcoin and Facebook’s Libra stablecoin can process 4.6 and 1,000 transactions in a second. PayPal and VISA, two popular payment portals, can process 40,000 and 1,700 transactions, respectively. No one matches this transaction strength.