The blockchain has come in the future, are you ready?

Author | Reporter Chen Jing, author Sheng Songcheng, Shanghai Municipal People's Government Counselor, Professor of Economics and Finance, China Europe International Business School

Source | Economic Daily

As a new technology that is thought to lead the world in a new round of technological change and industrial change, the blockchain has become the focus of public opinion. “A few years ago, I started the blockchain class. At that time, everyone didn’t care, but now every 4 students apply for courses, and only one person can choose.” Song Xiaodong, a professor of computer science at the University of California, Berkeley, personally feels Is a proof of the heat of the blockchain. In the first half of this year alone, there were 216 financing events in the global blockchain industry, with a total financing amount of 16.537 billion yuan .

In China, blockchain technology is also running at full speed. In 2010, there were only 379 companies with a blockchain in China, but as of the end of October this year, there were 27,513 domestic blockchain companies. According to Ren Zeping, chief economist of Evergrande Group, this new technology can “energy” the real economy and the financial system: “The blockchain of 'honest' and 'transparent' can be summarized as a wide range and across The main body, improve efficiency, reduce costs."

What exactly is the blockchain? Why is it considered to be the infrastructure of the future Internet… Before answering a series of questions, let us first face the most basic question: How does the Internet brought by the blockchain, and how to open a new door to trust the world?

 

• The Ministry of Industry and Information Technology has promoted the development of blockchain, and the Hong Kong Securities Regulatory Commission issued a regulatory framework for virtual asset transactions.
• Blockchain: A step in financial innovation
• “National team” grabs the blockchain and infrastructure is preferred

"big book" that cannot be tampered with

 

The official definition of blockchain is "distributed data storage, peer-to-peer transmission, consensus mechanism, encryption algorithm and other computer technology in the Internet era of innovative application mode", behind these blasphemy, what kind of technology is it?

“In a nutshell, blockchain technology is a large account that has been specially encrypted, follows the principle of minority compliance, and records the same transaction at the same time.” Long Fan, the founder of the tree blockchain, explains that “the information production department is responsible for record storage. Information, that is, ' block ', and the information is transmitted by the 'chain' encryption method , and anyone can perform accounting , but if you want to modify a certain information recorded in the book, it is hardly may."

A metaphor may be more concise. For example, if the buyer buys a product from the seller, both the buyer and the seller will “call” to the whole network at the same time: we have completed a transaction. Then each node on the blockchain records the transaction synchronously. One small account constitutes an oversized book, and the same transaction is consistent on different small books, open and transparent, and cannot be tampered with .

Solving the problem of trust has become the core competitiveness of blockchain technology. Its energy is working to establish a decentralized, open and transparent trust system with technology assurance, so that the digital world is as real as the physical world. "In the final analysis, blockchain is a kind of credit establishment paradigm that does not require trust accumulation. Any individual who does not understand each other can reach a credit consensus through a certain contract mechanism." Li Guangqian, researcher of the Development Research Center of the State Council In an exclusive interview with the Economic Daily, he said.

According to the degree of openness to nodes, the blockchain is mainly divided into three types, public chain, private chain and alliance chain . They are equivalent to public accounts open to everyone, private books within the company, and a number of companies forming alliances, public accounts used internally, but trust always exists. Based on trust, new application methods have emerged.

Jiang Guofei, vice president of Ant Financial Services Group, said quite quite frankly:

"In order to solve the problem of information asymmetry, untrustworthy transactions, etc., an Internet business model such as e-commerce, social, content, etc. has been formed, so that information can be effectively shared, and the blockchain directly constructs a value network based on the information Internet. It is able to make credible digital connections to assets that represent value, and record their complete processes of flow and equity distribution among the parties, greatly simplifying the friction of the parties in the traditional circulation.

Xiao Xue, senior vice president of Inspur Group Co., Ltd. also believes that:

"Under the profound influence of the blockchain, the Internet is moving from the information Internet era to the value Internet era. Blockchain enables people to transfer value on the Internet as easily, quickly and cost-effectively as messaging. Cloud computing, artificial Intelligence is new productivity, big data is production data, and blockchain is a production relationship that runs through the entire technology system."

 

The true value of the water after the stone

 

“In 2008, a self-proclaimed man named Nakamoto published an article called “Bitcoin: A Peer-to-Peer E-Cash System” and published the early implementation code in 2009, when Bitcoin was born. Li Guangqian said that Bitcoin is the first application of blockchain technology .

For this reason, ordinary people tend to associate blockchains with virtual cryptocurrencies, but a series of subsequent projects called “some currency” have been severely hit. The reason is precisely because the risk of virtual cryptocurrencies under the banner of the blockchain is not controllable , but also contains a lot of risk of speculation, speculation, and fraud.

From the "Notice on the Prevention of Bitcoin Risks" in 2013 to the "Notice on Preventing the Risk of Subsidy Issuance Financing" in 2017, "Notice on Cooperating with the Clearing and Rectifying of Virtual Currency Trading Platforms" to 2018 "On Prevention" "Monetary" "blockchain" in the name of the risk of illegal fundraising", in order to protect the interests of investors, a series of regulatory measures have been introduced, the "some currency" type of ICO (first currency issue) is characterized as illegal fundraising and comprehensively called stop.

Jiang Guofei said:

" Blockchain technology is not equal to speculating cryptocurrency . The cryptocurrency without actual value anchoring should not be the development direction of the blockchain industry. It should be vigilant against all kinds of scams in the name of the blockchain chain, so that this should be more The technology of value itself is a victim. Blockchain is not a tool for overnight wealth, but the infrastructure of the future digital economy ."

Si Xiao, the president of Tencent Research Institute, also believes that:

“The blockchain has experienced the stage of being chased to the bubble to the bottom, but it is also the process of smashing the waves. The parties in the blockchain industry still need to rethink the value of the blockchain in the process of trying to land, instead of blindly making 'pseudo- demand'."

The bubble is dissipated, and the true value of the blockchain is still affirmed by the “top design” . In October 2016, the Ministry of Industry and Information Technology released the White Paper on China's Blockchain Technology and Application Development, which first proposed the roadmap for the standardization of blockchains in China. In December of the same year, the “blockchain” was first written as a strategic frontier technology in the “Notice of the State Council on Printing and Distributing the National Informationization Plan for the “13th Five-Year Plan”. Since then, the state and local governments have issued a number of programmatic documents, encouraging the study of blockchains, conducting pilot applications, and supporting their innovative integration and frontier layout. In the first half of this year alone, 106 district block support policies have been issued.

The research, standardization and industrialization of related fields in the domestic blockchain have been actively promoted. “Industry collaboration creates many opportunities for the blockchain. Where data and value need to flow, where the efficiency is low and the process is particularly long, the development speed is especially fast.” Jiang Guofei said.

A series of blockchain applications that support the real economy and address the pain points of people's livelihood are being tested extensively. In the financial industry, the blockchain helps cross-border remittances, transaction settlement asset certification and protection; in the logistics industry, the digitization of goods greatly improves the visibility and predictability of logistics networks; blockchain electronic bills, blockchain electronic invoices, districts Blockchain electronic prescription… The blockchain is accelerating and innovative integration with all walks of life, giving new kinetic energy to the new round of development of various industries.

New prospects for opportunities and challenges

The blockchain has come in the future, are you ready?

From the perspective of industry consensus, the development of blockchain technology is still in its infancy . Ren Zeping said:

“Although capital and talent are rapidly influx, from the perspective of the industry, as the application scenario accelerates, it will develop faster in 3 to 5 years. How to solve the mapping of real assets in the chain and cross The interoperability of chain information and assets, as well as the scalability of blockchain, still faces challenges."

Xiao Xue also said:

"In addition to network performance, there are issues such as security and privacy issues for blockchain data, costing issues, and cross-chain connectivity."

However, from the perspective of technical reserves and capital support, China still has a good foundation in the blockchain field. The improvement of China's independent innovation capability has provided a guarantee for the accelerated commercialization of the blockchain . In 2017 and 2018, the number of open blockchain patents in China ranked first in the world for two consecutive years. In the first half of this year, the number of open blockchain patents in China was 3,547, and the total number of patents published in 2018 was over 2,035.

In terms of capital markets, from the global perspective, more than 95% of the blockchain financing events are currently in the seed round, angel round and A round, and the B round and later only account for 3%, indicating that the industry is still in the early stage. In China, as of the first half of this year, the proportion of financing for the blockchain initial startup project is still as high as 88.06%. At the same time, the domestic capital market is showing rationality . Since 2015, the proportion of strategic investment in China's blockchain sector has gradually increased, from less than 10% to 24.38% in 2018.

However, from the perspective of talent reserve, the construction of the blockchain talent team needs to be further strengthened . Huang Zhen, dean of the China Internet Finance Innovation Research Institute, said that the talent training system in this field is still in the early stage, and the overall talent size and quality are currently difficult to meet the fast-paced development needs of the industry.

"However, with the continuous development of blockchain policies, the maturity of industry development and the continuous increase of educational resources, China's blockchain talent training system will be more and more perfect, gradually alleviating the imbalance between supply and demand."

Jiang Guofei believes that

" China's blockchain industry will enter the commercial era ahead of time . This is due to the advancement of technological capabilities, system performance and data protection, etc.; secondly, open technology has triggered the group to accelerate innovation; thirdly, cooperation with industry benchmarks has stimulated snowballing. effect."

More blockchain services for the real economy

Sheng Songcheng

Blockchain technology has great potential for development and will be widely used in the future. However, for blockchain technology, the first important thing is to land and serve the real economy.

The blockchain has the characteristics of decentralization and data tampering, which helps to establish peer-to-peer trust and reduce transaction costs in the process of information transmission. For example, blockchain can be used to identify the authenticity of art. For example, in the field of mass service, digital copyright, intellectual property, and various certificates can use the blockchain to establish a new management mechanism to improve the fairness and fairness of public services. Transparency, and so on.

Of course, you also need to think about the cost of R&D and application of blockchain technology. In other words, the benefits of using blockchain technology can exceed its R&D and application costs . This account should be considered good.

It should be pointed out that the application of blockchain is not suitable for all fields .

For example, bitcoin with the blockchain flag was popular, and some people thought that the emergence of bitcoin was a huge challenge to the current monetary system. However, as time goes by, the non-monetary nature of virtual currency is gradually recognized by people. Recently, Libra, which has received wide attention, has different application scenarios from other cryptocurrencies or stable currencies, but its distribution mechanism also determines that Libra is difficult to exist as a real currency.

From the perspective of the history of currency development, there have been two revolutionary changes in currency, namely physical currency and modern credit currency. The physical currency is characterized by its own intrinsic value, and its value is used to measure the value of goods and act as a medium for commodity exchange. The modern credit monetary system is closely linked to the state and the modern economic and social organization. The national currency issued by the state has national credit support, behind which is the wealth of the whole society and the commodities of the transaction. The state issues the local currency according to the needs of the whole society for the production and trading of goods, guarantees the circulation of the functional currency by law, and maintains the stable value of the functional currency through the central adjustment mechanism, thus maintaining the normal operation of the modern credit currency system. It is not difficult to see that the currency sector is most in need of centralization, and the blockchain is precisely decentralized .

Monetary policy is one of the major economic policies of almost all countries in the world. The most basic condition for the use of monetary policy is that the central bank monopolizes currency distribution rights and regulates interest rates, exchange rates, prices, employment, and economic growth. Even with the advancement of technology, the development of a single banknote into various forms such as electronic money is still the endorsement of national credit, which is the most fundamental point. Sovereign countries will not give up monetary policy for the foreseeable future. Therefore, private creation and distribution of digital currency is not a real currency, does not have national credit support, and will have a serious negative impact on current monetary sovereignty, financial stability, monetary policy, and financial supervision.

In addition, efficiency and security are also important for the financial system , and the blockchain does not have much advantage over the current financial system . In fact, the current payment system is already very secure and convenient, and can support a relatively large transaction volume. Studies have pointed out that the blockchain is not as efficient in trading as the current payment system. If you want to anti-money laundering, anti-tax evasion, etc., the current electronic trading can also achieve this goal.

In short, more consideration should be given to using the blockchain technology to transform the real economy, to promote the deep integration of the blockchain and the real economy , and to return everything to the source. This is the direction in which the development of blockchain technology should focus.

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