Internet users in China have been employing blockchain to fight government censorship in new and innovative ways.
Blockchains are secure databases hosted on distributed computer networks. Every addition to the network requires digital signatures, so there is never any ambiguity about who is changing what, or when a change is taking place.
These databases utilize cryptography-based digital signatures that verify user identities, ensuring that only authorized users can access the stored information. A transaction is signed using a private “key”, which is generated upon an account’s creation. This key is usually a long alphanumeric code, and is known only to whoever controls the account.
Additionally, blockchains use complex algorithms to generate public keys from private ones, thereby allowing information to be shared. This is the case with Bitcoin wallet addresses, which serve as public keys through which other users can send payments, but only those with private keys can actually spend the digital currency.
In many ways, the purpose of blockchain runs contrary to the aspirations of the Chinese Communist Party, as decentralized databases invariably undermine the ability of authoritarian governments to control the means through which information is disseminated to the public.
In July 2018, Chinese citizens used a blockchain system to preserve an investigative story on inferior vaccines that had been administered to infants, despite being ineffectual in fighting illnesses such as tetanus. Changsheng Bio-Tech, the Shenzhen-based producer of the vaccines, was also alleged to have falsified data on approximately 113,000 doses of the human rabies vaccine.
The story was uploaded into the Ethereum blockchain’s metadata of transactions, which are public and permanent for anyone to read and cannot be altered by any unauthorized user. Given their distribution along decentralized networks, they cannot be pressured or removed by any company or Chinese censors.
Such censorship resistance has alarmed China’s government, which enacted a new regulation in February requiring users to provide their real names and national ID card numbers or mobile phones in order to use blockchain systems. Service providers are meanwhile required to record relevant transactions and information, while reporting illegal activities to the proper authorities, who in turn must have access to data inserted into blockchain databases. Additionally, service providers must prevent the production, duplication, publication and dissemination of illegal content, which blockchain services are also required to quickly remove. This may prove difficult, however, as information on blockchain systems are supposed to be immutable and therefore unremovable.
China’s modern approach to emerging technology has been to balance economic modernization with political control, as Beijing hopes to utilize blockchain to tackle a wide range of social and economic issues, including insurance fraud, food safety, and environmental pollution.
As the Chinese government is opposed to truly decentralized blockchain systems that rely on users competing to verify transactions, China has been the first nation to rank blockchains, with high-ranking ones having been developed in China or having strong Chinese connections. This is because it would be impossible for a blockchain to operate and thrive in the country without government assistance in helping it meet its censorship requirements.
The approach China has taken in regulating blockchain is a reflection of the challenges Beijing faces in adopting modern technology to remain in control, while also using tech advances to develop and boost the economy. Chinese alterations to blockchain applications have resulted in the loss of some of the original technology’s fundamental elements. New legislation, together with China’s system of ranking blockchain databases, could ultimately curb the ability of activists to use blockchain in their fight against censorship, while serving as an example for other authoritarian governments on how to utilize and develop blockchain technology.
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