On October 26, the Chinese Congress passed a cryptography law, which is supposed to come into force on the 1st of January, 2020. What changes in the field of blockchain and cryptocurrency technology can we expect in this country?
On Saturday, according to the Chinese report, the National People's Congress in China passed the cryptography law that is expected to be effective from next year. Interestingly, the announcement came just after the Chinese president advocated for the use of the potential of blockchain technology in the country. Maybe China felt threatened because of recent debates that took place in the US Congress during the interrogation of Mark Zuckerberg. Facebook's CEO has repeatedly stressed that Libra can become an effective weapon in the fight against China, after all, as the country strives to introduce its own digital currency. Although the trade in cryptocurrencies in this country is still banned, we can say that the efforts to increase competitiveness in the blockchain sphere are becoming more and more visible there.
What will the law bring?
As the National Congress of China claim, the newly enacted law will encourage both research and the development of commercial cryptographic solutions. It will build a comprehensive regulatory system for the market. Because of the fact that commercial solutions of cryptography play an increasingly important role in the development of the Chinese economy, this sector needs clear guidelines and regulations. It was stated as well, that the current loose system is no longer suitable for this industry. According to Congress, the new law will encourage, above all, nationwide educational efforts to promote cryptography among government officials, companies and whole society.
Is blockchain an opportunity for China?
President of the People's Republic of China, Xi Jiping, believes that the country should take an advantage of the opportunity offered by blokchain. He stated that this technology has a multitude of solutions, ranging from financing enterprises to mass transit or reducing poverty. He noted as well that China should treat the blockchain as a very important breakthrough and that it would be necessary to introdue the "rule of law" network in existing and future blockchain systems. Xi Jinping is of the opinion that China should focus more on testing this technology by giving support to training platforms and innovation teams.
In his statement, the Chinese president also proposed to create a platform that would focus on education, food safety and medicine.