- China announces a blockchain project to bolster the Belt and Road Initiative.
- China’s Conflux network will power the initiative.
- Blockchain has significant use cases in supply management.
Despite a crypto ban in China, the country is actively exploring blockchain technology. Most recently, the Chinese government has embarked on an ambitious blockchain project known as the “Ultra-Large Scale Blockchain Infrastructure Platform” for the Belt and Road Initiative.
Spearheaded by Conflux Network, this initiative aims to establish a robust public blockchain infrastructure supporting cross-border trade and Chinese commercial expansion across Asia, Africa, and Europe.
Chinese Blockchain to Power the Belt and Road Trade Network
On Sunday, March 31, the Shanghai Tree-Graph Blockchain Research Institute, the entity behind the Conflix Network, announced a major partnership with the Chinese government. The organization will develop an “Ultra-Large Scale Blockchain Infrastructure Platform” for the Belt and Road Initiative (BRI), a network of trade routes from China to Europe.
According to Conflux, the initiative seeks to establish a scalable and efficient public blockchain infrastructure to facilitate cross-border cooperation. This will form the backbone for implementing various cooperative projects across the nations participating in the BRI.
This puts blockchain at the center of one of China’s top strategic priorities, establishing a vast trade network across Asia, Africa, and Europe. BRI focuses on creating networks of trade routes, infrastructure projects, and economic corridors, reflecting the ancient Silk Road.
How Blockchain Can Boost Shipping and Trade
Blockchain technology can revolutionize supply chain management by providing real-time, immutable records of product origins, manufacturing dates, and transportation routes. This transparency builds trust among trade partners, significantly reduces the likelihood of fraud, and ensures compliance with international trade regulations.
Moreover, blockchain can simplify and secure cross-border financial transactions by reducing the need for intermediaries, lowering transaction costs, and speeding up settlement times. Smart contracts can automate payments and contractual obligations, further streamlining trade financing and reducing barriers.
Sponsored
Finally, in cross-border trade, sharing official documents (like customs documents, bills of lading, and certificates of origin) is often slow and prone to fraud. Blockchain offers a solution by enabling the secure, instantaneous sharing of digital documents, which can be authenticated and verified by all parties in real-time.
On the Flipside
- Challenges for using blockchain in BRI include technological interoperability, regulatory alignment, and scalability when handling the vast volume of transactions and data.
- Despite its potential economic benefits, the initiative has faced criticism. These include debt sustainability for participating countries, environmental impact, and concerns over governance and transparency.
- China has banned all crypto transactions and mining in 2021, citing environmental concerns and the speculative nature of the assets.
Why This Matters
The integration of blockchain technology into the Belt and Road Initiative showcases real-world use cases for the technology and its strategic significance.
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