Shanghai included blockchain, NFTs and Web3 in its 5-year plan

Shanghai included blockchain, NFTs and Web3 in its 5-year plan

The municipal government pledged to support the enterprises that are discovering the non-fungibles market.

China’s biggest city Shanghai officially intends to boost the development of innovations such as blockchain, nonfungible tokens (NFTs), metaverse and Web3 in general during its next five-year plan. 

On July 13, Shanghai’s Municipal Government published the draft of its “14th Five-Year Plan for the Development of Shanghai’s Digital Economy”. A document sets the mission of “promoting the deep integration of digital technology and the real economy,” with “scientists judging technology prospects” and “entrepreneurs discovering market demand”.

The plan suggests supporting the enterprises that plan to construct the NFT trading platforms and “research and promote the digitization of NFT and other assets.” A separate section is dedicated to blockchain, with a voiced commitment to promote the development and application of “blockchain+” technology and build a blockchain development ecosystem with strong innovation capabilities and independent control.

There is also a place for metaverse ambitions, as the municipal government plans to accelerate the research and deployment of the platform for the interaction between the virtual world and the real society by carrying out the development of core technologies and encouraging the creation of new platforms with richer and more diverse content scenarios. The plan emphasizes the significance of new forms of digital entertainment consumption, such as virtual concerts, virtual idols, and virtual sports.

A planned exploration of Web3 opportunities would include researching a multi-platform OpenID, distributed data storage, decentralized domain name resolution system (DNS), and end-to-end encrypted communication technology, complemented by the update of hardware base and deployment of 6G, Internet Protocol version 6 (IPv6), sixth-generation wireless network technology (Wi-Fi6) and quantum communication.

Related: NFT platforms in China grow 5X in four months despite government warnings

While the plan keeps silent on the prospects of decentralized finance (DeFi), it mentions “digital finance” with a promise to promote smart contracts and improve asset trading, payment and settlement, registration and custody. However, the section puts an emphasis on exploring the pilot of the digital yuan, a central bank digital currency (CBDC), cherished by the Bank of China.

Other, non-crypto-related directions of a five-year plan touch on the issues of smart cities, low-carbon energy, digital health, intelligent service robots and others.

In his article from June 26, Yifan He, the CEO of Red Date Technology — a major tech firm involved in the development of China’s major blockchain project called the Blockchain Service Network (BSN) — has called private cryptocurrencies the “biggest Ponzi scheme in human history.”

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Bank of England’s vision for the digital pound differs from China’s model

Bank of England (BoE) Deputy Governor Jon Cunliffe said the digital pound would likely operate as an account-managed instrument at the “trade level,” instead of a direct to retail user currency, Bloomberg News reported, Cunliffe — tasked with overseeing the United Kingdom’s CBDC project — told a panel that policymakers are considering ways to make the […]

The post Bank of England’s vision for the digital pound differs from China’s model appeared first on CryptoSlate.

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China Blockchain Alliance Executives: Virtual Currency the ‘Largest Ponzi Scheme in Human History’

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China’s BSN chair calls Bitcoin Ponzi, stablecoins 'fine if regulated'

China’s BSN chair calls Bitcoin Ponzi, stablecoins ‘fine if regulated’

Stablecoins like USDT and USDC would be doing just fine if properly regulated, while Bitcoin is a “Ponzi scheme” in any case, China’s BSN chair told Cointelegraph.

Amid the Chinese government continuing to celebrate the massive decline of cryptocurrency markets this year, one key local blockchain expert has referred to crypto as a “Ponzi scheme.”

Yifan He, CEO of Red Date Technology, a major tech firm involved in the development of China’s major blockchain project, the Blockchain Service Network (BSN), has penned a new article devoted to various kinds of cryptocurrencies and their supposed Ponzi-like nature.

Published in the local newspaper The People’s Daily on June 26, the piece refers to private cryptocurrencies as the “biggest Ponzi scheme in human history.”

The author mentioned the Terra network’s collapse, with the native token LUNA crashing 99% and the algorithmic UST stablecoin losing its 1:1 peg value to the U.S. dollar in May 2022. He also criticized the increasingly popular virtual currency concept known as X-to-earn, referring to move-to-earn or play-to-earn projects, calling the model a “phishing strategy.”

The BSN chair also mentioned some well-known criticism of Bitcoin (BTC) by Microsoft founder Bill Gates and legendary investor Warren Buffett.

He is not a fan of Bitcoin or any similar cryptocurrencies himself as well. “Currently all unregulated cryptocurrencies including Bitcoin are Ponzi schemes based on my understanding, just different risk levels based on the market caps and number of users,” He said in a statement to Cointelegraph on Monday.

The BSN chair added that he had not had any cryptocurrency wallet or related assets ever: “I don’t touch them and won’t touch them in the future even if they become regulated because I don’t consider that they have any value whatsoever.”

According to He, governments like El Salvador — which opted to adopt BTC as legal tender — “seriously need basic financing training.” “Otherwise, they put entire countries at risk unless their original intentions were to build state-owned crypto trading platforms and scam off on their citizens,” the exec told Cointelegraph.

While criticizing Bitcoin and many other crypto projects, He still believes that some part of the crypto market could be doing just fine if it’s properly regulated. Cash-backed stablecoins like Tether (USDT) and Circle’s USD Coin (USDC) should not be viewed as Ponzi-like schemes, the BSN chair said, stating:

“USDC or USDT are payment-related currencies, not speculative assets. Once they are fully regulated, they are fine.”

He previously talked in favor of stablecoins in 2020. The executive once planned to integrate stablecoin payments into BSN as of 2021. The plan was eventually scrapped due to China’s hostility to crypto.

Related: China warns Bitcoin is heading to zero but BoE looks on the bright side

The news comes amid the Chinese government capitalizing on the ongoing crypto market crash to justify its multiple bans on the industry. The latest coordinated ban was enacted in September 2021, with multiple Chinese authorities taking action to prohibit all kinds of crypto transactions in the country.

Despite all efforts, China continued to be a dominant Bitcoin mining supplier worldwide. According to data from the Cambridge Bitcoin Electricity Consumption Index, China was the second largest BTC mining hash rate producer after the United States as of January 2022.

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China’s WeChat bans crypto and NFT-related accounts

China’s WeChat bans crypto and NFT-related accounts

The policy also covers secondary NFT trading as the firm notes that “accounts that provide services or content related to the secondary transaction of digital collections shall also be dealt with.”

The top social media platform in China, WeChat, has updated its policies to ban accounts that provide access to crypto or NFT-related services. 

Under the new guidelines, accounts involved with the issuance, trading, and financing of crypto and NFTs will be either restricted or banned and will fall under the “illegal business” category.

The policy also covers secondary NFT trading, with the firm noting that “accounts that provide services or content related to the secondary transaction of digital collections shall also be dealt with in accordance with this article.”

The move was highlighted by Hong Kong-based crypto news reporter Wu Blockchain (Colin Wu) on June 20, as he pointed out the significance of the action given that WeChat has more than 1.1 billion daily users in China.

In terms of punishments, the new policy states that “once such violations are discovered, the WeChat public platform will, according to the severity of the violations, order the violating official accounts to rectify within a time limit and restrict some functions of the account until the permanent account is banned.”

The Chinese government rolled out a phased ban on the local crypto sector between May and September last year. However, given the timing of the latest policy update on WeChat, it could suggest the platform has been letting some crypto activity go unnoticed since then.

Furthermore, there is still a regulatory gray area in the country concerning NFTs as the assets can be purchased in fiat. Still, companies and platforms generally bar secondary trading to avoid potential compliance issues over the financialization of the tech.

In general, officials have frowned upon NFTs, with the China Banking Association, the China Internet Finance Association, and the Securities Association of China issuing a joint statement in April warning the public about the “hidden risks” of investing in the assets.

Related: Christie’s NFT expert to lead CryptoPunks, fake heiress launches NFT collection

Popular platforms such as WeChat and Ant group-owned WhaleTalk have been distancing themselves from the tech since March after they both reportedly began removing or restricting NFT platforms from their networks over a lack of regulatory clarity and fear of a crackdown from Beijing.

Despite this, a local media report from June 16 highlighted data showing the number of digital collectible platforms in China has grown to over 500, a 5X increase since February 2022.

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Chinese court invalidates 2019 car sale made using now worthless crypto token

Chinese court invalidates 2019 car sale made using now worthless crypto token

It appears that not only was the sales contract invalidated, but the buyer paid for the car with a questionable digital token in the first place.

Last week, a WeChat post published by the Shanghai Fengxian Court began circulating in crypto circles with regards to its recent ruling on a car sale in May 2019 made using digital currency. At the time, the buyer, identified only as Mr. Huang, signed a sales contract to purchase a 2019 Audi AL6 for CNY 409,800 ($59.477) in exchange for the consideration of 1,281 Unihash (UNIH) tokens with an undisclosed car dealership in Shanghai. Per the original contract, the seller was to deliver the car to Huang within three months’ time.

According to the Shanghai Fengxian Court, Mr. Huang paid 1,281 UNIH on the date of the contract signing but did not receive the car within the specified duration nor afterwards. As a result, Mr. Huang took the seller to court, demanding the delivery of the vehicle and the payment of 0.66% daily interest of the transaction amount in damages for everyday that the car went undelivered beyond the original deadline.

The case took over three years before a verdict was reached this June. Citing regulations in September 2017 that evolved into what is known now as China’s cryptocurrency ban, the Shanghai Fengxian Court said that digital assets “cannot and should not be used as a currency for circulation in the markets,” and that the use of digital tokens such as UNIH in lieu of fiat money as consideration in everyday contracts was in breach of respective regulation that overrides such contracts themselves. Therefore, the sales contract was ruled to be null and void. The buyer was neither granted damages, delivery of the car, nor a refund of his 1,281 UNIH. 

It’s unclear as to how the seller agreed to a conversion rate of 1 UNIH = CNY 320 as stipulated in the original contract in the first place. Unihash was supposedly a digital payment token developed for e-commerce in 2018 and was only available to private investors with no public initial coin offering. Shortly after its launch, allegations quickly surfaced on Chinese social media that labeled the project to be a “scam” and that its token metrics, as well as company history, had allegedly been grossly inflated to solicit investors. 

Currently, the project appears to be abandoned with no link to socials, no market listing, and no further development activity. Moreover, the firm behind UNIH did not accomplish any of its goals listed in its original whitepaper. One such promise made to investors in the document included: “What can be certain is that the Unihash token can appear on several exchanges by Q4 2019.” 

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