China has begun establishing national standards for blockchain technology to promote a “top down” building of a standard blockchain system. The new system is expected to be completed by the end of 2019 according to China’s state meida Economic Information Daily.

Li Ming, director of the Blockchain Research Office of the Electronic Industry Standard Research Institute of the Ministry of Industry and Information Technology, said in an interview that the plan of establishing blockchain national standards has been disclosed. It includes basic standards, business and application standards, process and method standards, credible and interoperate standards and information security standards. The applicability of the standards would further enhanced.

The related departments will also set up a national standardization committee of blockchain and distributed ledger technology in the near future.

Blockchain technology is a new integrated application of distributed data storage, peer-to-peer transmission, consensus mechanisms, and encryption algorithms. It has the characteristics of decentralization, openness, tamper resistance, and anonymity.

Blockchain applications in production chain, management chain, and transaction chain may reconstruct the entire life cycle of different industries to make the production life cycle more manageable and traceable.

Tech giant in China includes Baidu, Alibaba Group, Tencent and JD.com have already begun their lay out of blockchain applications. Many financial institutions, including state-owned Banks, such as Bank of China, China Construction Bank and Agriculture Bank of China have adopted blockchain technology in their actual business application scenarios.

However, blockchain technology is still on its early developmental stage and is not mature especially in the security issue. According to the Blockchain Industry Safety Analysis Report wrote by Baimaohui Security Institute, using of blockchain technology caused losses of $2.864 billion USD from 2011 to April 2018. In recent years, related losses has shown an exponential rise. The losses in 2018 along account for 1.9 billion of the total.

Deng Huan, directer of Baimaohui Security Institute indicated that,

“Currently, virtual currency is the most broad adoption of blockchain technology which causes big losses due to hacker attack.”

In this regard, Li Ming also confirmed that information security is one of the most important elements in the standard. He also indicated that, instead of speed up the development of blockchain technology in China, the aim of formulating the blockchain standard is to provide some guidelines for the industry.