China gets into blockchain race with U.S

China has launched an ambitious effort to challenge the U.S dominance in blockchain technology, which it could use for everything from issuing digital money, to streamlining a raft of government services and tracking Communist Party loyalty.

The technology received a crucial endorsement from President Xi Jinping last week, a signal that the government sees blockchain as an integral part of the country's plan to become a high-tech superpower.

Beijing is the latest in a handful of countries to have adopted a law strictly governing the encryption of data -- particularly blockchain technology, which allows the storage and direct exchange of data without going through an intermediary. Reputedly unfalsifiable, blockchain is a database shared across a network of computers. Once a record has been added to the chain it is almost impossible to change.

It is perhaps best known for underpinning the operation of cryptocurrencies such as Bitcoin -- which Beijing may seek to replicate as it pushes ahead with its plans for a world-leading government-run digital currency.

Although the new law for blockchain "is still rather vague", the country is clearly one of the most active in terms of regulation, Stanislas Pogorzelski, editor of specialist site Cryptonaute, told.

"China has understood very well that to stay a superpower, you have to be at the forefront of new technologies," said Pogorzelski.

Blockchain is set to play a key role in many sectors in the future, including digital finance, internet of things, artificial intelligence and 5G.

(Agencies)