After killing all legitimate cryptocurrency businesses in the country, Chinese authorities are now turning their attention to other blockchain service providers.
The country’s apex internet regulator, Cyberspace Administration of China (CAC), released a draft policy on Friday that will require all companies to collect their users’ real names and national identification card numbers before offering them any blockchain related service.
The draft regulations are open to comments from the public until November 2, but CAC hasn’t given any timeline for when they will actually come into force.
If the policy is implemented, the companies will be required to store their users’ data — to be made available for any investigation by the authorities. In addition, they also have to censor any content “deemed to pose a threat to national security.”
Blockchain service providers will need to register with the CAC within ten days of starting the service. If they are in highly regulated fields in the country, such as education, media & publishing, or the pharmaceutical industry, they will also have to obtain licences from relevant authorities before registering with the CAC.
According to South China Morning Post (SCMP), an anonymous open letter published on the Ethereum blockchain in April alleging sexual harassment at a top university could be the motivation behind the new regulations. While the authorities were able to remove the post from social media platforms like WeChat and Weibo, they were hopeless on the blockchain.
The new regulations come hardly as a surprise. China’s aversion to free dissemination of information isn’t exactly a secret — with media giants such as Google, Facebook, Twitter, and Youtube banned in the country. Blockchain as a concept is even more opposed to Chinese government’s totalitarian communist ideology.
China has been rigorously cracking down on “all things cryptocurrencies—” banning all exchange desks, media platforms, initial coin offerings (ICO), and any platform promoting or trading virtual currencies in any way. But research shows that the country’s outright bans haven’t exactly deterred illegitimate cryptocurrency businesses from operating in the country. It is likely that its blockchain regulations will end up with a similar fate.