The president of China is urging companies and government institutes to start embracing blockchain technology. President Xi Jinping sees blockchain technology as a core for innovation. He made these comments at a meeting of the Politburo Committee on Thursday.

According to Xi Jinping, the implementation and adoption of blockchain technology are key in the transformation of industries and innovation of technology. He pointed to use-cases in the financial business, mass transit and combating poverty.

“We must take the blockchain as an important breakthrough for independent innovation of core technologies. We must clarify the main direction, increase investment, focus on a number of key core technologies, and accelerate the development of blockchain technology and industrial innovation.” President Xi Jinping of China — translated by Coindesk, reported by XinhuaNet (Oct 25th 2019)

This marks the first time that the president of China has in-depth remarks on blockchain technology. He also added that laws should be adjusted or created to embrace these technological innovations.

Since 2017 it’s illegal to run cryptocurrency exchanges. However, the Chinese government is working on a Central Bank Digital Currency. When this digital yuan will be available is still a bit unclear. In July a court declared bitcoin to be a virtual property. As a result, this meant that cryptocurrencies are protected by law.

China Telecom already working on it

Even though the Chinese president just now started talking about blockchain, technology companies have been active for years. Recently China Telecom released a whitepaper in which they described the future of mobile telephones. Each phone would be contributing to a decentralized network, while allowing for example digital identity verification, supply chain tracing services, and express delivery services.

In the first place, China Telecom wants to build a blockchain application system. This system combats fraud, harassment, loss of data and crimes related to identity theft. Secondly, they plan a digital assets management system build into a SIM card.

Governments start using blockchain

Around the world, there are examples of governments that implement blockchain technology. For example, in Malta, the government puts rental contracts on the blockchain to combat fraud. In addition, Turkey is going to use blockchain to register academic diplomas and land ownership. The last example would be South Korea, where the government wants to put all its trading business on the blockchain. This would cut costs by 90 percent.

In other countries, legal frameworks and the introduction of CBDC’s are contributing to the adoption of blockchain technology. In San Marino, they’ve even announced a reward system, where green citizens receive crypto bonuses.