Why Is China’s Blockchain Industry So Different From The One In The West?

This article was published on the WeChat platform orangefans and written in Chinese by one of their authors. Just having attended a blockchain related event in Prague, he speaks really open about his personal view and experience regarding blockchain and the different approaches of the Chinese and the Europeans.

In early November, I attended a very different blockchain conference in Prague, Devcon4, similar to Apple’s WWDC, where all the members of the Ethereum ecosystem participated. About 3,000 people took part in the event, but there were very few participants from China, only about 50 people. Unlike the Chinese blockchain events I have participated in before, Devcon4 has a strong idealistic temperament. No matter whether it is the speech on the stage or the communication between the audience, almost no one discusses the price of the currency.

There are two types of topics that everyone cares about:

  1. What are the new developments in technology?
  2. What else besides technology can we do to help the development of blockchain in the world?

With four days of meetings and being in the middle of it all, I really felt the culture shock, but I was more wondering why the whole atmosphere of the Chinese blockchain industry feels so dramatically different? I have some vague answers, but I feel that I have been missing a piece of the puzzle.

It was until the last panel of Devcon4, where the organizer introduced Stewart Brand. He is a pretty old guy, talking very slowly, but when he started to talk about the past, I seemed to have found the missing piece. Brand is best-known in the country for “Stay hungry, stay foolish” and a “Global Overview”. In fact, his life is far more colorful than this magazine. He not only made a global overview that Jobs called “affecting a generation of Silicon Valley”, but also one of the organizers of the Hippie sports event called Trip Festival in the 1960s.

In 1966, he publicly called on NASA to publish a photo where you could see the whole earth in one picture.

In 1968 he helped Douglas Engelbart to complete „Mother of all demos” and showed a series of far-reaching technologies: Hypertext, Email, the mouse and the video call.

In 1985, he and his friends formed WELL, the first online forum with huge public influence.

In 1996, he founded the Long Now Foundation, encouraging people to think about issues from a long-term perspective, such as what will happen to humans in 10,000 years?

Looking at Brand on stage, I realized that although we are on the same earth, our worlds are totally different. No Chinese person will do any of the above ever. In the past half century, China and the West have developed in parallel universes. After the reform and opening of China, relationships have established more and more. Now, the situation has changed once again.

How can we be inaccurate in the future?

Born in 1938, Brand studied at Zuckerberg’s alma mater and graduated from the Stanford Department of Biology in 1960 at 22 years of age. If you are born in China and a well-educated young person, what will be the next step?

In 1966, the year when the Cultural Revolution began.

In 1968, the start oft he „Down To The Countryside Movement“

After the reform and opening up in 1985, Deng Xiaoping first proposed “opposing bourgeois liberalization.”

In 1996, there seemed to be no major incident, but it did not matter, it was close enough.

Wang Xing said such a sentence like many of China’s current problems belong to the GDP per capita being too low. Another sentence was, before going to a place, you can estimate the local situation by looking up the local GDP per capita. These two sentences are rude but true. After nearly two decades of rapid development, China’s GDP has barely squeezed to around 80. The gap between the United States and Europe was still very big, and it would be even more difficult to catch up. On a material basis, we are already in two worlds.

This time in Prague, I chatted with the landlord of my Airbnb. He is about my age and stays at home full-time. He talked to many Chinese tenants and knew that life in Beijing was very stressful and the smog there was very serious. So I asked him:

„What stresses you in your life?”

He thought about it and said,

„I don’t have any. Prague is a bit like a city in a fairy tale. Everyone’s life is relatively simple. After work everybody is going out with their friends.”

After a few days, I realized that most streets indeed have a lot of bars. When I walked through the streets every night, there was literally a bar every few steps I took. Several young men were chatting in front of the door, while it being very lively inside. Prague is indeed worth being called a city of a fairy tale. As the capital of Habsburg, the city has different architectural styles and preserves memories of different eras.

The city is small, and there are even fewer people. Only about 10 million people living in the Czech Republic, and only 1.2 million people in Prague. There are a lot of benefits of being so fewer people. You don’t have to construct and maintain huge buildings, which makes it easier to please peoples housing needs, three subway lines are enough, and the peak hours are not that crowded. In the subway, books are being advertised a lot and there are actually a to of people reading while taking the subway too.

One of my colleagues then asked me: “Do you think that this city has this unchangeable vibe of not being in a rush and insists in doing one thing until it is done?“ But at home, in China, everything is rapidly changing all the time, it is difficult for everyone to calm down and do just one thing.” With most young people in China still need to worry about housing, medical care, and education issues, how should you be able to support the innovation of blockchain?

What happens if China gets really rich?

Having commodities is, of course, important, but regarding this issue, I feel that the human soul may be more important after all. The spiritual basis of China may be doomed to the inability to breed technologies such as blockchain. Just like Joseph Needham’s question: „Why was the industrial and scientific revolution born in Western Europe despite China’s wealth during the Ming dynasty?

There are many answers regarding different genres:

  1. Institutional differences: The West pays more attention to protecting private property rights and patents. Innovation is sustainable and offers high returns. But China is a big unified central system, where everything is about the emperor.
  2. Different cultures: The Greek culture and the Renaissance have built the foundation of Western culture, while Chinese Confucian culture respects the ancient, bounds the free thoughts of people and inhibits innovation.
  3. The natural environment and manpower: China has more a lot of people and relatively less land. The West, on the other hand, is the opposite. Hence, China tends to develop technologies which improve land use efficiency, while the West tends to develop technologies that help humans to live a better and more efficient life.
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Today, China has become more westernized in many aspects. We have begun to focus on protecting individual property rights and encouraging innovation, but many changes have stopped at the institutional level where cultural changes are destined to be slow. 

We really haven’t been in the field of blockchain for a long time. In just nine months, we can quickly feel that the core cultural characteristics of the blockchain circle are very clear, born out of password punk, hippies and hackers in the 1960s. They naturally believe in one thing, as Brand said: “Mastering the tools and skills necessary to make us freer, these tools and skills include computers, programming, radio, internet, open source software, blockchain. 

Having those, human beings can avoid being enslaved in key matters and do not have to rely on intermediaries any more.”

I don’t know how you feel, but I listen to the language of another world anyway. Indeed, I have access to these ideas through many books, but in real life, I rarely come across people who believe that “tools can make people more free” and there are fewer people talking about this. But in this field, it is a self-evident consensus.

Seriously, I am not sure if the above paragraph can be sent out on WeChat. I suddenly understood what Orwell said in 1984 to create a new language. Yes, if you can’t discuss a concept, the concept naturally does not exist. Groups with this kind of consensus will do things that seem to be difficult for others to understand.

They will abandon living in the city, turn to the wild to gather in a commune, and build their homes, houses, water, and electricity, art, defense – Everything starts with yourself. They will insist on a communication network, operating system, encryption tools and currency for all humans, all of which must be unlicensed, even at the beginning to compromise on performance and ease of use.

Others may ask, what is the use of these things? We already have a good life and tools. They will answer: Some things cannot be measured by “usefulness”, such as science, freedom, and people. So far, the breakthroughs in the basic technology of blockchain have basically come from abroad, and China has a bright performance in the application fields of exchanges, wallets and mining machines.

This situation does not look like it could be reversed for the time being. If blockchain can be widely used in this decade, China will have a big chance to miss the underlying technological innovation once again and shine at the application layer. Some people may say that there is nothing wrong with this. Let them explore it first. When the infrastructure is set up, we will not be late. The Internet is also a latecomer. Isn’t there a world-class company like Tencent and Alibaba? This is indeed a very effective follow-up strategy to avoid many risks. The price is that our underlying technology is always on one leg. In many places, it is difficult to catch up once it falls behind, such as the current chip and operating system.

After a few years, historians may ask questions again, why is the blockchain revolution not happening in China? We are part of this history, we can look at it with widely opened eyes, and do it without knowing how the future will be, but how will this future be reviewed?

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