China’s top court calls for blockchain to record vast number of transactions
Leases, IP rights, ownership of goods … it’s almost easier to list things the Supreme People’s Court doesn’t want on a blockchain
China’s Supreme People’s Court has issued an opinion calling for massive adoption of blockchain across China’s judiciary, financial sector, and government, and for the technology to underpin intellectual property in the nation.
Published last week, the opinion* reveals that the Court has already recorded 2.2 billion items on a judicial blockchain. The Court now suggests 32 more initiatives, most of which concern using blockchain to enhance efficiency of, and trust in, the nation’s judiciary.
But the recommendations also go far wider, calling for the creation of “an interoperation collaborative mechanism with blockchain platforms”. That effort will allow “market regulation, property registration … and enable inquiry about and verification of information related to the ownership registration and status of transactions, such as basic business profile, variation of corporate equities, correlation between businesses, ownership of immovables and movables, financial leasing, precious metal trading, to facilitate the identification of ownership and transactions of property rights, so as to intensify the development of the classified and categorized supervision system based on data and credit, and to further improve the national business environment.”
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The opinion also calls for blockchains to become part of China’s infrastructure to manage registration and protection of intellectual property, market regulation, property registration, data ownership, online data trading, transactions between financial institutions, and the insurance market.
The document doesn’t say when that vision might become reality but sets a 2025 deadline for implementation of “a blockchain alliance featuring interconnectivity and sharing between the people's courts and all social sectors … with the capabilities for fundamental support for data verification, trusted operation, smart contract, interoperation collaboration, etc. to be dramatically improved.”
That suggests the Courts like the idea of most transactions being recorded on blockchain so that evidence can be easily obtained and verified, a situation that may not appeal to lawyers who often charge plenty of money for discovery of documents in the lead up to large cases.
The opinion also refers to blockchain being used “in administrative law enforcement” and to impose “credit-based punishment, etc. and develop a model of automatically carrying out investigation and control in enforcement and imposing credit-based punishment, so as to improve the working efficiency of collaborative enforcement.”
That reference to “credit” probably describes China’s system of “social credit” which assesses citizens’ behaviour and may restrict access to some privileges or services if a low social credit score is recorded. Paying taxes late, for example, is thought to have a negative effect on a social credit score. Indicators of behaviour that contribute to a social credit score may be gathered from many sources, so a blockchain to record and consolidate records could make it easier for China to rate it citizens activities and keep them in line.
While China has banned cryptocurrency several times (with mixed results), national policy calls for extensive use of Blockchain. Last week, regulators issued a list detailing an eighth batch of government-approved blockchain projects.
Those efforts, and the Court’s urging to go even further with distributed ledgers, suggest Blockchain will be a big part of Chinese society. ®
* If you have trouble following the link, you can look at this PDF, which we have machine-translated into English.