Beijing Once Banned Bitcoin – Now It’s Inevitable Blockchain

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Two years ago, China banned crypto outright, leaving Web 3.0 companies to block Chinese user registrations and flee the Middle Kingdom.

Today, Beijing may be responsible for quietly making Web 3.0 almost inevitable.

This was easy news to miss if you don’t speak Chinese or follow blockchain news – but on June 2, 2023, officials speaking at an industry forum released the “Beijing Internet 3.0 Innovation Development White Paper”.

The document outlines the capital’s attempts to encourage consensus and development of the Web 3.0 industry, laying out the technical needs behind the technology Beijing officials say will underpin generative artificial intelligence, content production, XR interaction terminals and other technologies.

To be clear, the People’s Bank of China has not reversed its September 2021 ban on cryptocurrencies, which are perhaps the most important use case of blockchain for casual Web 3.0 users.

China upheld the 2021 ban, leading companies like Binance and Huobi to block people with Chinese phone numbers from using their services.

For some crypto purists, the omission of digital currencies negates any sense of forward momentum.

Many in the space have mixed feelings about CBDCs (central bank digital currencies) like the “digital yuan” China has in the works, and it doesn’t take much for them to rise.

These skeptics, however, miss the point.

While Chinese residents won’t be trading Bitcoin anytime soon, the decision by Beijing and dozens of other cities across China to release reports expressing their support for blockchain technologies is a clear sign that they consider Web 3.0 as an essential infrastructure for the future Internet.

In fact, the white paper calls Web 3.0 “the culmination of modern science and technology, and the inevitable trend of the future development of the Internet industry,” according to translations of the text published by Zhao Changpeng, CEO of Binance, on Twitter this week.

This is what the mass adoption of Web 3.0 looks like. It’s piece by piece, brick by brick.

This is critical validation for the underlying technology that drives everything from cryptocurrencies and non-fungible tokens to digital ledger services and decentralized financial services.

Even countries with CBDCs have certain advantages.

While government-regulated currencies artificially restrict competition, they will most likely give Web 3.0 users and app developers a better understanding of the blockchain products they can create and use in the future, encouraging growth. future of this essential Internet infrastructure.

Moreover, it becomes even more difficult for crypto-skeptical countries to put off further investment in blockchain technology when some of the most powerful nations in the world not only admit that it is here to stay, but also dedicate more funds and space research. – although Beijing’s pledge to allocate 100 million yuan per year (about $14 million) is a relatively modest amount.

It’s no wonder, then, that Beijing’s “Internet 3.0” white paper has received praise from Binance’s Changpeng, Huobi CEO Justin Sun, and Animoca Brands co-founder Yat Siu, among others. other prominent Web 3.0 leaders.

More critical than real monetary investment is the signal it sends to the rest of the world – Beijing’s support for Web 3.0 is a not-so-subtle nod to the country’s support for Hong Kong’s new digital asset regulations, which came into force on June 1, 2023.

Regardless of your personal geopolitical ties, it is a well understood fact that competition drives nations.

China’s support for blockchains makes it impossible for Western countries to completely back out of Web 3.0 innovations, as it could put them at a competitive disadvantage.

This is important, especially as the European Union maintains its largely restrictive stance on Web 3.0 technologies, and the United States, despite being a hotbed of blockchain innovation, have increasingly cracked down on Web 3.0 companies while perhaps underestimating how self-sufficient they can be with the right support.

Imagine how different the world would be today if the United States, after seeing the dot-com collapse, decided to crack down on internet infrastructure companies rather than continue to develop them.

Web 3.0 has the potential to be just as transformative as the evolution of the Internet that humanity has experienced over the past two decades – and after Beijing’s announcement this week, no major nation will want to stand idly by and risk ending up in the “Stone Age” of Web 3.0.

Imagine if the epicenter of Silicon Valley was in Guangzhou and not Palo Alto.

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Jack O’Holleran is the co-founder and CEO of SKALE Labs – the team behind SKALE, the world’s fastest blockchain, designed for ultra-fast, secure and user-centric Ethereum scaling. Jack is a veteran tech entrepreneur from Silicon Valley with a strong background in machine learning/AI technologies and blockchain.