China’s Blockchain-based Service Network (BSN) is planning to introduce support for non-fungible tokens (NFTs), the South China Morning Post reported. The BSN is a state-backed multi-blockchain hosting network initiated by the State Information Center (SIC) along with Red Date, China Mobile and China UnionPay. As cryptocurrencies are banned in China, the NFTs will be denominated in Chinese yuan.
To differentiate them from public blockchain NFTs, they will be referred to as BSN-Distributed Digital Certificates (BSN-DDC). The BSN launched the network to make blockchain hosting simpler and affordable for SMEs. Likewise, the new BSN-DDC will make it cheaper to mint NFTs compared to the big Chinese platforms. According to He Yifan, CEO of Red Date Technology, BSN’s technology support provider, an NFT can be minted through the BSN-DDC for as little as .05 yuan (.7 cents).
“NFTs in China will see annual output in the billions in the future,” said Mr. He.
While NFTs have never been banned in China, companies that have ventured into the industry have been cautious, often referring to them as digital collectibles as opposed to NFTs. Companies that have launched the collectibles include Alibaba’s fintech affiliate Ant Group and Tencent. Some brands have also introduced celebratory NFTs, such as McDonalds.
At least in the West, the concept of NFTs has been closely tied to cryptocurrencies. Many NFT platforms and initiatives are backed by cryptocurrency investment funds and established players in the industry. When brands launch new projects in this sector, at least part of their objective is to attract a crypto enthusiastic market to their consumer base.
The BSN-DDC initiative has the potential to showcase the utility of NFTs beyond collectibles. Internationally, NFTs have already been used for a variety of applications. For example, Breitling deploys them as luxury goods passports that prove authenticity.
The use of the term ‘digital certificate’ is a hint that the BSN intends the solution to be used similarly to prove authenticity and digitize paper-based processes.
The BSN network supports 20 different blockchains, and in the case of the DDCs it will be integrated with ten of them, including an adapted version of Ethereum, Corda and FISCO-BCOS. It has already attracted more than 20 partners.
Meanwhile, last year Red Date Technology received a $30 million investment led by a subsidiary of Saudi Aramco. As for the BSN, there are two branches to the network, one in China and a separate international one. The international network is planning to support multi currency payments and multiple future central bank digital currencies (CBDC). Additionally, last year EY began integrating its blockchain solutions with the infrastructure.