China has launched the first government-led initiative regarding blockchain technology in announcing the opening of the “Trusted Blockchain Open Lab.”
China’s Academy of Information and Communications Technology (CAICT), a research institution under the Ministry of Industry and Information Technology, aims to bring together blockchain firms and experts to work on blockchain applications, according to a Caixin report.
However, what exactly a “trusted” blockchain means is unclear. The Economist famously called blockchains a trust machine because they allow for coordination and verification of information even when some parties are hostile or dishonest.
With that trustless aspect being one of its key invention. While Vitalik Buterin, Ethereum’s inventor, defined blockchains as “a decentralized system that contains some kind of shared memory.”
It is because of this shared memory, with each node being able to verify the rules for themselves and so becoming instantly aware if they are breached, that the system creates a method of coordination without requiring trust of any party.
Making the term of a trusted blockchain somewhat of a misnomer. But, as stated, we do not know whether that is simply words or whether they are trying to create permissioned blockchain based applications.
Rumors have been circulating recently that China may be able to launch it own digital currency, operated through blockchain technology, but controlled in increase or decrease of supply by PBoC.
That’s in the context of China’s draconian recent crackdown on bitcoin and crypto exchanges, with rumors swirling that miners might be next.
At the same time, the Communist Party is seemingly trying to distinguish its actions against public blockchains, like bitcoin and ethereum, and their approach towards blockchain technology in general, with Caixin stating they want to encourage the latter.
However, it is probable skills will be in even more short supply than usual, as it is unlikely any talented blockchain coder will want to in any way associate themselves with a government which has so suddenly and unexpectedly turned against this space. Not least because they may ask whether the same wouldn’t happen again for their project or collaboration.