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- Digital yuan and BSN creation can support China to dominate the global blockchain infrastructure
- Within a year, BSN has expanded by about 108 nodes across several Chinese cities
- Accelerated adoption of Chinese blockchain and the digital national currency is a threat to the United States financial and technological dominance
Digital yuan and the Blockchain-based Service Network (BSN) has been launched by the Chinese government. Since 2019 China has been promoting blockchain technology since the government triggered research on the technology. However, with the launch of the first central bank digital currency, China has threatened the United States’ dominance over the financial and technological industry. Dominating over such sectors, the United States has long benefited itself. But now, it seems that China’s embracing of blockchain technology has threatened the dominance of the United States.
BSN offers numerous services for a smart city
China has launched BSN, its own Blockchain network that builds a global infrastructure network. Basically, BSN lowers the cost hurdles of blockchain to anyone, which helps offer cutting-edge networking infrastructure. Such infrastructure includes digital payments, cloud computing, communications, and other services at a lower cost.
Within a year, BSN has expanded approximately 108 nodes in 80 Chinese cities. Embracing the technology, such cities are receiving infrastructure for smart cities. Moreover, the network is integrated with few large public blockchains to communicate like computers do use internet protocols. Such blockchain networks include Ethereum, Tezos, ConsenSys, Quorum, and others.
Following the pace of adoption, it seems soon the Chinese blockchain network will get adopted on a global scale. And the adoption will help give the country a type of de facto dominance, which the US has over the internet.
Digital yuan has come as the rival of the US dollar
The Chinese central bank has launched the digital yuan as a live beta project. The country had publicly indicated its intentions that it will expand the digital national currency globally.
While maintaining coveted capital controls, the digital yuan can be internationalized. The currency can enable Beijing to expand economic and security surveillance both at home and foreign. Moreover, the digital form of yuan can offer an alternative to Western international payments systems like Swift. And help circumvent sanctions, arms embargoes, and money laundering regulations.
Hence, if the Chinese CBDC will get circulated globally, China will begin dominating the blockchain infrastructure. Ultimately, the domination will cement Beijing’s economic influence and soft power.
US pays insufficient attention to Chinese BSN
Following the BSN and the digital yuan scenario, the adoption pace shows that soon China will dominate the blockchain infrastructure. However, seeing the accelerated adoption of BSN, it seems the United States should pay more attention. Blockchain is global and generally aligns with fundamental free enterprise, democratic values, and monopolistic control, which presents a threat to such values. However, the US and its partners can potentially mitigate such threats by continuing aggressive diplomatic and economic policies. Moreover, adopting new effective informational and military strategies will also help the US to diminish such threats.
