China’s internet watchdog publishes draft regulations for blockchain-based information services

The Cyberspace Administration of China (CAC), the central government’s Internet regulator, censor, oversight, and control agency, has published a draft policy framework aimed at regulating blockchain-related service providers in the country, CoinDesk reported.

The CAC has published “The Regulation for Managing Blockchain Information Services" and is seeking public feedback on the same. The deadline for public comments is November 2, 2018.

The draft policy seeks to “standardize blockchain information service activities, promote the healthy and orderly development of blockchain information services, protect the legitimate rights and interests of citizens, legal persons and other organizations, and safeguard national security and public interests.”

The document defines blockchain information service provider referred as “the entity or node that provides the blockchain information service to the public, and the organization or organization that provides technical support for the blockchain information service.”

If enacted, the regulation would require blockchain information service providers to register with the CAC within 10 working days from the date of providing the service. These entities would be required to register their names, service types, industry fields, and server addresses. The CAC said that this information will be publicly available.

Importantly, the regulation would prohibit service providers from using blockchain technology to "produce, duplicate, publish, and disseminate" information or content that is prohibited by Chinese laws.

In addition, blockchain information service providers would be required to implement know-your-customer measures and authenticate the identity information of the users based on their national identification numbers or mobile phone numbers.

"Service providers must store the logs and content published by users of their blockchain services for six months and provide this information to law enforcement when required," the document states.