Dispelling China’s Global Blockchain Lead Narrative
The assumption that China may be the world’s purported leading country in the blockchain space is no longer new. It has been building up right before President Xi Jinping made his historical blockchain ‘endorsement’ speech last October. The emerging considerations that tends to put this claim to test as against where it stands with the U.S. are new though.
China has filed more than double the number of blockchain patents than in the US last year – 3,200 to 1,300. However, despite this high volume of patent filings from China, an analysis points out that relatively few of them are cited as being relevant to subsequent patent applications around the world – known as “forward citations”.
The Withers & Rogers research also notes that many Chinese blockchain patent applications aren’t filed in other countries.
Based on these two metrics which are regarded as indicators of patent value, how valuable the projects that form China’s leading number of filings are is being questioned. In other words, going by the perspective of the analysis, it could be contested – as it suggests – that the patent applications filed in the US can be regarded as more valuable on average than Chinese applications.
There have been several talks of the U.S. losing out to China as the Asian giant pushes a wider agenda in the blockchain space, with some reports even connoting there is ‘a war’ going on in this regard. Nonetheless, the U.S. continues to maintain its lead over China with a higher number of blockchain developers.
Another analysis suggests blockchain seems “to be a workable solution without a problem”. It suggests that despite its highlighted inherent merits, the analyst notes that the real challenge for China with blockchain, it seems, “isn’t using the blockchain” but “figuring out where a hot technology is actually useful.”
The author notes that China’s digital currency ambitions may not “be globally competitive” for the many problems facing them. These reportedly include the inability to fully prevent fraud at home, ease of laundering cryptocurrencies than cash and the unlikelihood of an RMB-backed digital currency gaining global adoption in areas or industries without a heavy Chinese hand.
China is seeking to modernize their financial sector in the face of a slowing GDP and trade problems with the U.S. which have injected uncertainty into the most confident of forecasts, according to McKinsey. While the global consulting firm states that some have “predicted that these developments will spell bad news for Chinese consumption, which has helped power economic growth at home and abroad”, its research suggests there is no need to worry so much.
There is no doubt the blockchain industry in China is growing quite fast. Meanwhile, the country continues to toughen its stance on virtual currency trading platforms – for their supposed capabilities to create the potential for investor harm in different ways – while encouraging blockchain technology.
According to a recent report on China’s cultural industry claims “Blockchain” as well as “5G plus Culture”, “Nighttime Economy” and others have been included in its keywords for 2019.
The U.S. is not currently developing a digital currency but looking into the possibility. Whether the U.S. hesitating to create its digital currency is increasing China’s chances to lead the rest of the world is not sure.