Li Lihui, the former president of the Bank of China, believes that to promote the development of blockchain technology and industrial innovation, it is necessary to break through the technical bottleneck and speed up system construction.
Speech: Li Lihui, Former President of Bank of China
We are entering the digital economy society . What is most important in a digital economy society? My answer: One is link , and the other is trust .
According to calculations from the Global Association for Mobile Communications GSMA, the scale of my country’s Internet of Things in 2019 will be about 3 billion, of which the scale of industrial Internet of Things is about 1.3 billion, and the scale of consumer Internet of Things is about 1.7 billion; by 2025, The link scale of the Internet of Things in my country will reach 7 billion, of which the link scale of the Industrial Internet of Things is about 3.8 billion, and the link scale of the Consumer Internet of Things is about 3.2 billion.
Li Lihui, Former President of Bank of China
Digitally linked economic society has two basic characteristics: First, the time and space distance between people, between people and things, and between things will approach zero. This will provide a wider range of convenience, will also bring more direct danger, pose a major security challenge. This requires feature recognition, time-space positioning and identity authentication of people or things, and confirm end-to-end control and command. The second is that digital assets and asset-based digital cultural products can be directly traded, which requires confirmation of the ownership of the assets and the identity and qualifications of the parties to the transaction.
Therefore, we need to establish a reliable trust mechanism. In 2019, the Blockchain and Distributed Accounting Committee of the International Organization for Standardization made a definition: Blockchain is the use of cryptographic technology to add consensus-confirmed blocks in order to form Distributed ledger. In the economic dimension, I understand the blockchain as a “trusted, interactive, encrypted, and shareable value chain”, and I believe that the blockchain has unique technical advantages to meet the needs of the digital economy and society.
First, digital trust based on technical endorsement.
Big data technology discovers credit through data mining, discovers credit value, and establishes digital trust.
Blockchain can establish a trust mechanism of “technical endorsement”, solve the trust problem through mathematical methods, and express rules with algorithmic procedures. As long as the common algorithmic procedures are trusted, mutual trust can be established.
The value of digital trust lies in: it can form a trustworthy bond in an environment where trust is unknown or weak, save the time and cost required for credit formation, and support commercial credit to a certain extent and to a certain extent; it can be used in a wide area and high-speed network Establish a zero-day, zero-distance certification tool to improve the actual efficiency and operational reliability of the Internet of Things. Further analysis, digital trust can solve the problems of who I am and who you are, who the ownership belongs to, and who the command and control power belong to. It has high efficiency and low cost inclusiveness.
Second, three-dimensional interaction based on distributed architecture.
The unique distributed, end-to-end architecture of the blockchain can realize the parallel transmission of information, realize information sharing, and control parallel cross-over. Therefore, in scenarios with multiple counterparties, multiple transaction links, long management chains, and high degree of dispersion, a time-space folding and three-dimensional interactive business structure can be constructed to improve cooperation and operation efficiency.
The blockchain-based block data structure, consensus mechanism, timestamp and key technologies used in the blockchain can prevent tampering of original data, control the risk of data leakage, and protect privacy and data security in a three-dimensional interactive scene involving multiple parties.
The information technology architecture we are familiar with is centralized and closed in local areas. The business society we are familiar with is independent of market entities and interactive on a flat surface. The traditional credit mechanism we are familiar with is self-contained and separate. Through the establishment of digital trust and three-dimensional interactive architecture, blockchain technology has the potential to recreate business models and improve the efficiency of resource allocation .
One is to build a distributed ledger system shared by financial institutions.
Financial transactions are characterized by high concurrency and multiple platforms. The application of blockchain technology can build a distributed ledger system with the participation of large, medium and small financial institutions, form a technical platform for the interconnection of financial institutions, realize information sharing, product sharing, and service sharing, and provide more efficient financial services. For example, in the supply chain finance scenario, the application of blockchain technology can establish a multi-party collaboration structure and trust mechanism, overcome the limitations of traditional business credit, and transmit core corporate credit to more levels; business agreements can be incorporated into smart contracts to prevent Misappropriation of funds and malicious breach of contract. Blockchain + supply chain can build an ecosystem of mutual trust, interconnection, high efficiency and low cost. The trade finance blockchain platform launched by the People’s Bank of China in Shenzhen can realize multi-level financing of supply chain accounts receivable, cross-border financing, supervision of international trade accounts, and external payment tax filing forms.
The second is to build an efficient financial supervision system.
The financial technology supervision system being piloted can quickly decouple and combine complex data sets, can share supervision data from multiple parties, can implement consistent compliance standards, can release the value of data through data mining, and can automatically generate supervision reports and solutions Solution, so as to realize the whole process of financial supervision and all-round intelligence, go beyond the complicated process and resource-consuming on-site supervision, and reduce the cost of supervision and supervision. In this system, blockchain-specific distributed ledgers, smart contracts, data fidelity, and three-dimensional interaction technologies are used for trust enhancement, cross-institutional cooperation, data encryption sharing, and business process optimization.
The third is to build a cross-local public service platform.
For example, Shanghai’s international trade blockchain + platform has 10 functional sections for supervision and service, 53 applications, docking 22 departments, covering the main links of international trade and the entire supervision process, and can provide enterprises with public services related to international trade. , And extend the provision of digital financial insurance, supply chain finance and other services.
The fourth is to build an end-to-end digital currency.
Many central banks have launched digital currency research and development. The Bank for International Settlements and the United States, Europe, Japan, the United Kingdom, Canada, Switzerland, and the Riksbank recently published a report on “Central Bank Digital Currency, Basic Standards and Core Features”. The legal digital currency in the pilot program in my country adopts a centralized management and indirect issuance model, and adopts a method of “account loose coupling” plus a digital wallet. It has the technical advantage of offline transactions and can provide the public with a payment tool with high security and good liquidity. , To make daily life easier, and it is also possible to “overflow” across borders and develop into a global digital currency.
The digital currency Libra being planned by Facebook and other co-founding institutions strives to meet the financial compliance standards of the United States and other Western developed countries, clearly maintains a centralized technical architecture, and promises to develop a comprehensive framework for financial compliance and network-wide risk management, and establish anti-money laundering , Anti-terrorism, compliance with sanctions and strict standards for preventing illegal activities, and promise to maintain the currency hegemony of the US dollar. Once Libra is approved by the United States, it should be able to obtain market access from Western countries and may rapidly develop into a super-sovereign digital currency. What needs attention is that super-sovereign digital currencies may subvert and reconstruct the global monetary system and traditional financial models: transcending national sovereignty, overriding central banks, and surpassing commercial banks.
The application of blockchain technology has been extended to many fields such as digital finance, Internet of Things, intelligent manufacturing, and supply chain management, showing a bright future for industrial development. On October 24, 2019, General Secretary Xi Jinping pointed out: We must take the blockchain as an important breakthrough in core technology independent innovation, clarify the main attack direction, increase investment, focus on a number of key core technologies, and accelerate the promotion of blockchain technology and Industrial innovation and development. General Secretary Xi’s speech, standing at the height of the digital economy national strategy, pointed out the main direction, key path and basic principles of blockchain technology and industrial innovation and development.
To promote the development of blockchain technology and industrial innovation, we must grasp 4 keys.
First, break through the bottleneck of blockchain technology.
In terms of underlying technology, as a technological integration innovation, basic component technologies such as blockchain databases, peer-to-peer networks, and cryptographic algorithms are relatively mature, but the degree of integration is not high enough; new technologies such as consensus mechanisms and smart contracts need to be improved.
At present, no country has realized the large-scale application of blockchain technology. my country’s blockchain technology research and development is committed to breaking through the bottleneck of large-scale and reliable applications in terms of privacy computing technology, authenticity supervision mechanism, smart contract technology, key technology, and diversified technology platform integration.
Second, penetrate data islands.
The Internet of Everything means the collection of data, but the collection cannot automatically solve the problem of data islands. It is necessary to penetrate administrative data islands to realize public data sharing; penetrate local data islands to build specialized databases.
Penetrating data islands requires effective protection of data privacy and data security. The laws of our country have stipulated the basic principles of protecting data privacy and data security, but the specific and detailed regulations need to be clarified. I personally believe that the focus of legislation and law enforcement is: how to balance the rights of data owners with the interests of data owners, how to coordinate the macro stability and micro power of the digital economy society, how to cultivate citizens’ consciousness and form corporate behavioral norms.
Third, master the core digital technology.
Digital technology equality is the cornerstone of equal competition in the digital economy. Even in large countries, closed-loop economic operations generally only reduce the efficiency of economic resource allocation, increase the overall cost of economic operations, and affect the quality of national consumption. However, if you are constrained by others in key technical fields, once you encounter a large-scale blockade, it may cause economic stalls and hinder the process of globalization. Therefore, not only in the field of cutting-edge hardware manufacturing, but also in the field of core software development, only by making up for its shortcomings can my country truly establish an equal and mutually beneficial relationship with Western developed countries.
The key to occupying the digital technology highland lies in talents, innovative scientific research institutions and core enterprises led by high-end talents. We should allocate financial resources and increase soft investment in technological innovation. It is necessary to encourage more private teams to create a fairer and more relaxed business environment for private enterprises. It is necessary to truly encourage the national team and support state-owned enterprises to establish an incentive mechanism that conforms to the laws of market economy and science and technology.
Fourth, speed up institutional innovation.
Based on the healthy development of digital finance, my country should accelerate the construction of a digital financial system, step up the development of digital financial systems such as blockchain financial supervision, digital asset market supervision, digital currency supervision, and legal digital currency issuance, and gradually establish and improve a digital trust mechanism.
my country’s technical standards, safety regulations and certification systems for blockchain have just started. We should promptly improve the standards, safety regulations, and certification review systems for blockchain technology and blockchain finance. In law, the legal definition of digital assets should be clarified, the contract nature and validity of smart contracts should be clarified, and the responsible entities under the distributed architecture and their behavioral norms and regulatory standards should be clarified.
