Chinese state-backed blockchain company launches major overseas project
China’s Blockchain Service Network (BSN) is planning a major international expansion project in August.
Yuichiro Chino | moment | Getty Images
The state-backed Chinese blockchain firm is planning its first major international expansion, its CEO told CNBC, as Beijing continues to make technology a key priority.
Blockchain-based service network (BSN) It calls itself a “one stop shop” for deploying blockchain applications in the cloud, a process that could otherwise be costly and time-consuming. It aims to link different blockchains together to help companies implement the technology.
Red Date Technology, a Hong Kong-based start-up, is one of the founding members of BSN. Company CEO Yifan He told CNBC that BSN plans to launch a project called BSN Spartan Network overseas in August.
Blockchain has become famous with cryptocurrency bitcoin but its definition has expanded since then. It refers to a system of shared activity logs, which may be public and available to everyone, or private, where only a few participants can use and edit them. Bitcoin is an example of a public blockchain.
BSN’s blockchain networks, however, don’t work with any cryptocurrency because China has cracked down on digital currencies.
Proponents of blockchain technology say it can reduce costs and increase the speed of some business processes. Chinese president Xi Jinping has personally approved the technologyelevating it to a national priority.
The international plan will be a major boost for BSN.
The Spartan network will ultimately be made up of half a dozen public blockchains that don’t work with cryptocurrencies. One of them will be a non-cryptographic version of Ethereum blockchain when the project launches in August.
Blockchain transactions usually cost money. But he said the commission will be paid in US dollars rather than Ethereum’s related cryptocurrency called ether.
“The aim is to minimize the costs of using public chains so that IT is more traditional [information technology] Business systems and systems can use public chains as part of their systems, “he said.
“That’s why we’re working with other major public chain protocols to convince them that the mainstream is non-cryptographic public chains.”
The CEO of Red Date Technology admitted that not having cryptocurrencies as part of the company’s product offering is a challenge. He said BSN Spartan Network will be “hard to push in the first or second year because most people in the blockchain industry only understand cryptocurrencies.”
BSN will likely face overseas scrutiny due to its ties to the Chinese government. The company is supported by the State Information Center (SIC) which is part of China’s powerful National Development and Reform Commission (NDRC). Chinese telephone companyAlso behind the project is a state-owned telecommunications company.
He said BSN’s Chinese background is a “big challenge” as it expands internationally.
“That’s why when we have a launch in August, we will immediately open the source code and are working with many Western companies,” he said.
“People will say that BSN is from China, it is dangerous. Let me stress, BSN Spartan will be open source … we will not access anything on our side.”
It also said that users will be able to inspect the code behind the project to ensure there is no backdoor access for the Chinese government.