No room for crypto in China’s Web3 landscape

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Have you ever hated anything so much that you would seek to tweak its very foundations to accelerate its path to extinction? Well, I certainly hope not, but it’s too late to say a prayer for China. The world’s second largest economy has made its palpable distaste toward cryptocurrencies more evident each day.

Simply put, China doesn’t like cryptocurrencies, given the cloak of anonymity under which transactions in this space occur. The country, which doubled down on its crypto and crypto mining ban last year, has put in place the building blocks of a Web3 infrastructure that seeks to extract the benefits of blockchain technology while isolating itself from anything related to crypto.

As China lays the foundation and reimagines the Web3 space, its success could be the final nail on the crypto coffin, but its failure would likely strengthen ties between the crypto and Web3 worlds.

In today’s premium story, Tech in Asia breaks down China’s Web3 sector to understand the distinctions and dissects its chances of gaining widespread acceptance as the nation prepares to export its version of Web3 to the world.

Today we look at:

• China’s crypto-less Web3 world
• A Singapore crypto platform’s pause on withdrawals amid industry crisis
• Other newsy highlights such as Atome’s US$45 million boost and a SG cybersecurity startup’s funding round.

Also, if you’re an entrepreneur looking for funding, fill out this form to get your company featured on our list of fundraising startups.

Premium summary

Building blocks

Image credit: Timmy Loen

All industries must find a way to adapt to varying regulatory requirements around the world. As China’s Web3 space takes shape, it is clear that all blockchains must comply with the crypto ban and support user identification processes within the country. This means that all blockchains operating in China are permissioned – a concept that has irked critics of Red Web3.

These critics say that non-crypto blockchain and distributed digital certificates are antithetical to the concept of a public blockchain. But for some investors, this is merely one stage of evolution for Web3, which has to adapt in order to gain acceptance in China’s regulatory environment.

• Ground zero: For three years, China has been working on an ambitious nationwide project called Blockchain-based Service Network (BSN). The project is driven by its technical architect, Hong Kong-based developer Red Date Technology, and also operates as a blockchain-as-a-service platform for the Chinese government. BSN functions as “Layer 0” infrastructure that enables individual Layer 1 blockchains to be built on top of it to form a network.

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