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.

Source: Guosheng District Block Chain Research Institute

Summary

Event: The reply of the Ministry of Industry and Information Technology website on November 4th, "Response to the No. 1394 Recommendation of the Second Session of the 13th National People's Congress", proposed that the three major measures will promote the healthy development of the blockchain industry. The Hong Kong Securities Regulatory Commission issued the "Standard Book Supervision Virtual Assets Trading Platform" to clarify the licensing conditions for regulatory standards.

The three major measures of the Ministry of Industry and Information Technology promote the development of the blockchain industry, with equal emphasis on planning, standard designation and application. The "Reply to the Recommendation No. 1394 of the Second Session of the 13th National People's Congress" issued by the Ministry of Industry and Information Technology on November 4 disclosed the relevant suggestions put forward by the Ministry of Industry and Information Technology. The Ministry of Industry and Information Technology pointed out in the "Reply" that "our Ministry attaches great importance to the development of next-generation information technology such as blockchain and industrial Internet, and the relevant departments such as the Union Banking Supervision and Supervision Commission actively take measures to promote research, technology research and development and application promotion of related industries." It will actively promote the healthy and orderly development of blockchain, including: first, strengthening blockchain planning and guidance; second, establishing and perfecting blockchain standard system; third, accelerating the application of industry. The market has previously worried about the blockchain's theme and concept, but we judge that after the policy is clear, the “regular army” will accelerate the entry, and all kinds of blockchain transformations to the original scene will advance rapidly, and it is expected to see it in the future. The business closed loop appears.

Actively pay attention to the three major scenarios of finance, people's livelihood and government affairs. In the financial scenario, it is difficult to solve the problem of financing loans for SMEs, difficult to control the bank, and difficult to supervise the departments; in the livelihood scene, provide more intelligent, more convenient and better public services for the people; improve the intelligence and precision of urban management. The level of protection; ensuring the orderly and efficient flow of production factors within the blockchain; in the government affairs scene, the government data is maintained and utilized across departments and regions to bring better government service experience to the people. With the rapid spread of the alliance chain, the blockchain will play an important role in the three major scenarios, serving the real economy while promoting the progress of blockchain technology research and development.

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The Hong Kong Securities Regulatory Commission issued the "Stance Book: Supervising Virtual Assets Trading Platform" to clarify the licensing conditions for regulatory standards and regulate the development of the industry. The Hong Kong Securities Regulatory Commission of the Hong Kong Securities Regulatory Commission issued the "Standard Book: Regulating Virtual Asset Trading Platform". The third part is the regulatory framework for the virtual asset trading platform, which mentions the licensing conditions for regulatory standards. For the virtual asset trading platform, the licensing conditions may be imposed under section 116(6) of the Securities and Futures Ordinance: including six conditions for the licensee to provide services only to professional investors. Prior to this, Hong Kong's blockchain sandbox supervision was slower. Under the new blockchain policy, various regulatory new policies are expected to advance, and digital asset trading is illegal. This time, the conceptual regulatory framework for virtual asset trading platforms has been clarified. An important step in the supervision of virtual asset transactions is to lay a foundation for further standardizing virtual asset transactions and promoting the development of blockchain and virtual asset trading markets.

Recommended mainline: We believe that after the blockchain new deal, all local enterprises are rapidly following up, and the awareness of blockchain by listed companies is deepening. It is expected that for the future, various application scenarios and core technologies of blockchains will be developed. The policy will follow up. In terms of targets, we continue to recommend the following three blockchain service targets on the main line:

1. Financial services. (1) Supply chain finance: easy to see shares, Quartet Jingchuang, Hailian Jinhui; (2) financial security, blockchain asset hardware storage: Weishitong, Geer software, Feitian integrity;

2. People's livelihood services. (1) Electronic invoice, payment: Donggang shares, Guangdian Express; (2) Electronic certification: digital certification; (3) Copyright service: Anne shares. 3. Government affairs scene: Huayu Software.

In addition, it is recommended to pay attention to Hong Kong stocks Co., Ltd. (HK 1611) for the regulation of virtual asset trading platform in Hong Kong .

Risk warning: regulatory policy uncertainty, blockchain infrastructure development is not up to expectations.

1. The three major measures of the Ministry of Industry and Information Technology promote the development of the blockchain industry and pay attention to the application of the three major scenarios.

Event: The reply of the Ministry of Industry and Information Technology website on November 4th, "Reply to the No. 1394 Proposal of the Second Session of the 13th National People's Congress", disclosed that the Ministry of Industry and Information Technology has responded to the National People's Congress representative Zhu Lifeng's "about the new retail, blockchain The specific content of the proposal to combine the high-quality development of small and medium-sized enterprises with the industrial Internet. It is proposed that the three major measures will promote the healthy development of the blockchain industry.

The three major measures of the Ministry of Industry and Information Technology promote the development of the blockchain industry, with equal emphasis on planning, standard designation and application. The "Reply to the Recommendation No. 1394 of the Second Session of the 13th National People's Congress" issued by the Ministry of Industry and Information Technology on November 4 disclosed the relevant suggestions put forward by the Ministry of Industry and Information Technology. The Ministry of Industry and Information Technology pointed out in the "Reply" that "our Ministry attaches great importance to the development of next-generation information technology such as blockchain and industrial Internet, and the relevant departments such as the Union Banking Supervision and Supervision Commission actively take measures to promote research, technology research and development and application promotion of related industries." It will actively promote the healthy and orderly development of blockchain, including:

First, strengthen the blockchain planning and guidance; second, establish and improve the blockchain standard system; third, accelerate the promotion of industry application.

Actively pay attention to the three major scenarios of finance, people's livelihood and government affairs. In the financial scenario, it is difficult to solve the problem of financing loans for SMEs, difficult to control the bank, and difficult to supervise the departments; in the livelihood scene, provide more intelligent, more convenient and better public services for the people; improve the intelligence and precision of urban management. The level of protection; ensuring the orderly and efficient flow of production factors within the blockchain; in the government affairs scene, the government data is maintained and utilized across departments and regions to bring better government service experience to the people. With the rapid spread of the alliance chain, the blockchain will play an important role in the three major scenarios, serving the real economy while promoting the progress of blockchain technology research and development. Taking supply chain finance as an example, based on the alliance blockchain platform, it is expected to effectively solve the financing difficulties of the SMEs in the supply chain industry and the high cost of trust. The supply chain enterprises are actively on the chain. According to the data of the Prospective Industry Research Institute, it is expected to grow to 15 trillion yuan in 2020. Supply chain finance can inject capital into upstream suppliers, improve the operational efficiency and overall competitiveness of the supply chain, and is of great significance for activating the supply chain.

The Ministry of Industry and Information Technology "2018 China Blockchain Industry White Paper" analyzed four supply chain financial platform cases including Tencent Blockchain, Easy View Shares, Financial Accounts and Zheshang Bank. Based on the real trade background of supply chain, blockchain The technical characteristics make the upstream and downstream parties in the supply chain actively “wind up”. The “Easy Block” supply chain financial application system developed by Yijian Co., Ltd. based on blockchain technology was launched in April 2017. The system is centered on the “core enterprise+, controllable commodity+, dynamic asset ABS+” scenario. Manufacturing, pharmaceutical, logistics, bulk, aviation, real estate and other nearly 10 industries and more than 10 financial institutions. The “Easy Block” platform can realize the five functions of “trade portrayal, transaction visualization, credit machine, direct connection between banks and enterprises, privacy protection”. The “Easy Block 2.0” system has created a traceable supply chain financial service plan. Focus on solving data trust and financial risk issues in supply chain financial scenarios. As of October 2019, the “Easy Block” supply chain platform has completed nearly 176,000 credible transactions, with a credible transaction volume of over 15 billion yuan, 419 chain financing contracts and a financing amount of over 4.7 billion yuan. Through the online system of “Easy Block”, the real trading background of the two parties in the transaction is recorded and characterized in real time. Based on the huge and real trade background of suppliers, upstream and downstream enterprises urgently need a technology platform such as blockchain to solve the industry pain points. Enterprises are actively embracing the blockchain situation.

The Hong Kong Securities Regulatory Commission issued the "Standard Book Supervision Virtual Assets Trading Platform" to clarify the licensing conditions for regulatory standards and regulate the development of the industry. The Hong Kong Securities Regulatory Commission of the Hong Kong Securities Regulatory Commission issued the "Standard Book Supervision Virtual Assets Trading Platform". The third part is the regulatory framework for the virtual asset trading platform, which mentions the licensing conditions for regulatory standards. For virtual asset trading platforms, licensing conditions may be imposed under section 116(6) of the Securities and Futures Ordinance: (a) Licensees may only provide services to professional investors. (b) The licensee must comply with the accompanying “Terms and Conditions Applicable to the Virtual Asset Trading Platform Operator” (as amended from time to time). (c) The licensee must obtain prior written approval from the SFC for any plans or recommendations that introduce or provide new or accompanying services or activities or make significant changes to existing services or activities. (d) The licensee must obtain prior written approval from the SFC for any plans or recommendations to add any product to its trading platform. (e) The licensee must provide monthly reports to the SFC on the business activities in the form prescribed by the SFC. (f) The licensee must appoint an independent professional company acceptable to the SFC to conduct an annual review of the licensee's activities and operations and to prepare a confirmation that it has complied with the licensing conditions and all relevant legal and regulatory requirements. Reports and other six conditions. This time, the conceptual regulatory framework of the virtual asset trading platform was clarified, and an important step in the supervision of virtual asset trading was taken to further standardize virtual asset transactions and promote the development of blockchain and virtual asset trading markets.

We recommend the following three blockchain service companies on the main line.

1. Financial services. (1) Supply chain finance: easy to see shares, Hailian Jinhui; (2) financial technology: Quartet Jingchuang; (3) financial security, blockchain asset hardware storage: Weishitong, Feitian integrity.

2. People's livelihood services. (1) Electronic invoice, payment: Donggang shares, Guangdian Express; (2) Electronic certification: digital certification; (3) Copyright service: Anne shares.

3. Government affairs scene: Huayu Software.

In addition, it is recommended to pay attention to Hong Kong stocks Co., Ltd. (HK 1611) for the regulation of virtual asset trading platform in Hong Kong.

risk warning

Regulatory policy uncertainty. At present, the blockchain is in the early stage of development. There are certain uncertainties in the management of blockchain technology, project financing and tokens in various countries around the world. Therefore, there is uncertainty in the development of industry company projects.

Blockchain infrastructure development is not up to expectations. Blockchain is the core technology for solving supply chain finance and digital identity. At present, blockchain infrastructure can not support high-performance network deployment. Decentralization and security will have some restraint on high performance. Blockchain infrastructure exists. Develop risks that are not up to expectations.

This article is selected from the report issued by Guosheng Securities Research Institute on November 6, 2019, “Guosheng Blockchain | Ministry of Industry and Information Technology, Three Measures to Promote Blockchain Development, and Hong Kong Securities Regulatory Commission to Issue Virtual Assets Trading Regulatory Framework”. For details, please refer to Report .

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