Economist Lang Xianping talks about the blockchain industry under the epidemic: stripping of currency attributes, blockchain rebirth

Text: Lang Xianping

Source: People's Digital Fintech

Editor's Note: The original title was "Professional Perspectives | Stripping Currency Attributes, Rebirth of Blockchain Nirvana-Blockchain Industry in Epidemic"

Beginning on February 20, the global capital market opened a plunge mode, and has now entered a technical bear market. US stocks have blown 4 times in 10 days, and so far no bottom has been found. In the face of this situation, I can understand why many people are wondering why the safe-haven gold has not risen, but I cannot understand that some people expect Bitcoin to hedge. From February 20 to March 22, the price of gold fell from $ 1620 / ounce to $ 1500 / ounce, a decline of 7.4%, while Bitcoin dropped by 40% during the same period.

On January 27, 2014, I first talked about Bitcoin in public. At the time I made it clear to everyone that "Bitcoin has a price but no value and does not have monetary attributes." On January 23, 2017, I once again called for Bitcoin to be a Ponzi scheme of drums and flowers, and clearly told everyone: "The only value of Bitcoin is the entire mathematical logic itself." technology!

Bitcoin and blockchain are like twin brothers. Bitcoin creator Satoshi Nakamoto engraved an exquisite "Jade Seal" with gold, expecting him to become the king of global currency. The jade seal engraved: I invented a non-inflationable currency for humans, only 21 million. We can think of it as a kind-hearted joke on the world by geeks. However, this jade seal was particularly beautifully carved, combined with the greed of capital, so he became by far the largest bubble in the history of human money. Looking at this farce from a historical perspective, the only value of Bitcoin is the gold used for carving jade seals. This gold is-blockchain technology!

Bitcoin's carrier, blockchain technology, can only be reborn after it has peeled off its currency. Tamper resistance, decentralization, and traceability can only be of value if they are applied in the real world. At present, the application of bitcoin in the real world is mainly the underground economy in the dark web fields such as drug trading, arms trading, kidnapping for ransom, making and selling false certificates, and Internet blackmail. The value of blockchain technology can only be seen again after the currency coat is stripped. At present, there are only two major players in the application of blockchain technology in China and the United States. I think more promising is China. Blockchain technology has already played a role in finance, medical treatment, insurance, and food safety after optimization. For example, the insurance exchange of a certain place has established a distributed data interaction platform and service platform in conjunction with multiple insurance companies, which has played a role in reducing channel fees and shortening service processes. In September 2018, a financial services group and Huashan Hospital affiliated to Shanghai Fudan University launched the nation's first electronic blockchain prescription, solving the problems of information sharing in the medical field and patient privacy protection. Some e-commerce platforms have begun to use blockchain technology to implement product traceability, prevent false information, and protect consumer rights. In June 2018, a payment platform launched a blockchain-based e-wallet cross-border remittance service in Hong Kong. It only takes 3 seconds to complete the e-wallet cross-border remittance function, while traditional cross-border transfers take several days. It is precisely because of these practical applications that at least 763 investment institutions worldwide participated in the investment or merger of 516 blockchain projects in 2019. In the current global stock market crash, China's blockchain sector has remained stable. Since 2020, major global financial markets have plummeted by more than 30%, the Shanghai Composite Index has fallen by 11%, and the blockchain sector has risen by 1.8%.

In the future, the combination of the Industrial Internet and blockchain will be the next super vent. At present, China's industrial Internet system has begun to take shape. The average daily analysis volume of the five major national nodes (Chongqing, Beijing, Shanghai, Guangzhou, and Wuhan) has reached 1 million times, and 47 secondary nodes have covered 20 industries and enterprises. A total of 1059 nodes have been accessed, and the number of industrial Internet logo registrations exceeds 2.5 billion. With the expansion of the industrial Internet connection scale, we urgently need to connect data between the upstream and downstream of the industrial chain through the blockchain to solve new problems such as production synergy, information sharing, resource integration, and flexible supervision among enterprises.

The epidemic will accelerate the development of the blockchain in two directions, one is the transmission of public information; the other is the establishment of SME credit. However, both directions need a centralized organization: government, industry associations, banks, etc. to take the lead to fully play the value of blockchain decentralization. For example, the epidemic has exposed some of the shortcomings of our charity industry, and the combination of blockchain and donations can accurately trace the source, circulation and use direction of each good money, and achieve full transparency. Transparency is precisely the highest standard of philanthropy. In terms of epidemic information transmission, the current information transmission system is the vertical reporting system of provinces, counties and townships. If epidemic prevention information can be directly linked to hospitals, communities, disease control centers, and even the public through blockchain technology, then any institution will try to prevent epidemic information. Transmission will be ineffective, and rumors related to the epidemic will be self-defeating.

Under the epidemic, production was stagnant, and SME operations were severely affected. Tsinghua SEM and Peking University HSBC questionnaire survey on 995 SMEs showed that 34% of SMEs' balances can only be maintained within 1 month, 33.1% can be maintained for 2 months, and 17.91% can be maintained for 3 months. How to identify which companies deserve priority assistance is a huge cost for banks, and the application of blockchain technology can partially solve these problems. The banks cooperate with the central enterprises of the industrial chain to communicate with the upstream and downstream through blockchain technology to identify those that have real orders but lack short-term funds, and then provide financing. A bank established a receivables chain in this way of blockchain, which helped 17,000 companies revitalize their financing facilities. The receivables chain also continued to play a role during this epidemic. On February 7, a group in Beijing also began to experiment with a blockchain-based supply chain debt and debt platform. It is believed that the future blockchain will play a greater role in the credit granting of SMEs.

Stripped of currency attributes, the blockchain is reborn.