The call made by Xi Jinping last month, in a speech where he openly encourages companies in his country to take advantage, use and rapidly develop blockchain technology, was welcomed by the technology industry in his country.

Jinping's unexpected promotion of cryptography took the markets by surprise, promoting the increase in the shares of some 70 companies in the region's technology area.

Bitcoin also experienced an increase in its value after the announcement of Xi, as searches for the term blockchain on WeChat grew 60 times. Both WeChat and AliPay now have a green light to take advantage of cutting-edge technology.

But why Xi Jinping promote the Blockchain?

There are at least four reasons why Xi Jinping urged its technology entrepreneurs to boost the use of crypto.

1. To Lead the market
The Asian giant is known for its determination to do everything in a big way; it had already shown it before when it boosted Artificial Intelligence and 5G technology. On both occasions, it managed to get its businessmen to lead, while developing huge revenues.

Huawei, with its more than 70 thousand workers in the area of ​​research and development, achieved revenues of more than USD 26 billion during the first three months of 2019. Now it is developing the 5G platform in Europe.

Now China is driven with the same impetus to do the same with blockchain technology. At the same time that Xi Jinping declared that it was a national priority, all the cities advanced in technology and known as cities level 1 and 2, had all their attention to implement the blockchain use.

2. To Get ahead of the United States
The US and China are currently facing a strong trade war, so taking advantage for China is a matter of national interest. The conversations between both nations are not on the right track. The US imposed a series of limitations on tariffs on exports and agriculture. But everything has changed in the field of technological battle.

By losing China to its largest buyer, it decided to direct its goods to new markets, so it is now making a strong presence in the European, African, and Middle Eastern markets. Especially in the well-known Economic Belt of the Silk Road.

For China, having an advantage in the use of blockchain technology is synonymous with opening up to a new trade in technology markets. A market of such magnitude that it is not yet known for sure what its scope may be.

3. To Throw a world digital currency
One of the advantages that Xi Jinping is willing to take is the launch of a global currency. Hence, he is so interested in digital assets, and his proposal is intended to require private information to its users at the time of registration, but at the same time, it will provide a kind of controlled anonymity.

This responsibility to create a Digital Currency of the Central Bank of China will fall to the People's Bank of China, who will have the commitment to issue it. This digital asset will be backed by China's fiduciary reserves, maintaining a certain level of anonymity and a fairly broad encryption service.

On the other hand, as the current Yuan (RMB) has no international acceptance, the new digital currency has an attractive marketing advantage. Being able to offer cross-border payments at a very low cost and high transfer speed.

4. To Confront the Libra
At the time Facebook made the announcement of the launch of the Libra, it said it was backed by several currencies of the great commercial growth, leaving out the RMB, so the Chinese government, feeling excluded, planned its response. This resulted in a reaction from the People's Bank of China.

The Facebook Libra, controlled by the Swiss-based Libra Association, needs to face regulations that satisfy the different countries that support it while the digital RMB has a clear path for launch.

China already has the payment channels UnionPay, AliPay, and the WeChat super application with more than one billion users and is already operating as a large digital bank.

Xi Jinping's speech

After the announcement of Xi Jinping in his speech, a huge amount of initiatives and news related to financing and support for blockchain developments were triggered. One of the biggest announcements was to finance Technology Holdings that has its parent company in Shenzhen, which offered a fund for USD 1 billion for the development of the blockchain consortium.

China will leave behind the reference cities in blockchain technology such as San Francisco and New York, becoming the new reference axis of this technology. Companies have been, for some time, orienting their compasses towards blockchain technology, which is why the decision of Xi Jinping has forced us to look towards the Asian giant.

This is an announcement that will keep us aware of the news that may happen in your environment. Its influence on the existing cryptocurrencies and the advertisements of other countries that will seek to join the race for crypto.