In recent years, the trend of digitalization of the global economy has become more and more obvious. Traditional industries are accelerating the transformation and upgrading of digitalization, networking, and intelligence, making the scale of the digital economy continue to expand and becoming a new driving force for global economic development. As a new economic form, the digital economy includes not only an economy that uses data or digitized knowledge and information as a key production factor, but also includes digital technology methods such as cloud computing, big data, the Internet of things, artificial intelligence, and blockchain.
Benefited from the advent of the digital economy era, related technologies are constantly iterating and upgrading, and many new types of technologies have emerged. These new technologies are also one of the main driving forces for the sustainable development of the digital economy. Facing the wave of digitalization, many technology companies, including Avnet, are also actively promoting technological innovation while exploring new models and new business formats.
In 2020, the China Academy of Information and Communications Technology released the White Paper on China’s Digital Economy Development, stating that “digital economy is based on digital knowledge and information as the key production factors, digital technology innovation as the core driving force, and modern information networks as an important carrier. Through the deep integration of digital technology and the real economy, we will continuously improve the level of digitalization, networking, and intelligence in traditional industries, and accelerate the reconstruction of new economic forms of economic development and governance models.”
Blockchain: the core password for the development of digital economy
Blockchain is one of the representatives of digital economy technology. It is an important part of a new generation of information technology. It is a new type of database software integrated with multiple technologies such as distributed networks, encryption technologies, and smart contracts. In recent years, the global application of blockchain technology and industry has extended to multiple fields such as digital finance, Internet of Things, intelligent manufacturing, supply chain management, and digital asset trading, showing broad application prospects.
Blockchain is the use of consensus-based mathematical algorithms to establish a “trust” network between machines, and create new credit creation through technical endorsements. Therefore, this technology is also regarded as supporting the transfer of trust and management in the digital economy. The key to value. From the perspective of the industry, the new technology represented by blockchain technology is related to the long-term layout of the security and intelligence of the future digital economy.
From the perspective of the working mode of the blockchain, it is a record-keeping system. There will be multiple sources to verify the entry before adding it to the data chain. Once the data is added, it cannot be changed, and the records are distributed to multiple locations on the network. Adding a new record (called a block) to a blockchain sequence requires verification by multiple members connected to the blockchain network. These data blocks are connected to each other to form a chain. All transactions in the blockchain are open to everyone in it, but all personal identities are hidden.
Blockchain technology uses algorithms to assign a cryptographic hash (a unique string of letters and numbers, sometimes called a “digital fingerprint”) to each block. In addition to the hash, each block also contains a time-stamped record set of previous transactions, as well as the hash of the previous block. It is this mechanism that ensures that an immutable link is established between consecutive blocks in the chain. The combination of encryption and timestamp ensures that blockchain technology can automatically verify that this growing hash sequence will never change. This operating mechanism can prevent new blocks from being inserted out of order, thereby preventing transaction data from being altered or forged afterwards.
Through such data verification and encryption methods, blockchain is expected to completely change the way consumers and enterprises interact with data, and redefine how people will manage the supply chain, maintain transactions, and exchange assets. According to industry analysis agency Gartner, by 2025, the added value of the blockchain business will grow to US$176 billion.
Blockchain in China
In April 2020, the block chain has been included in the scope of new infrastructure by the National Development and Reform Commission, and it is clear that it belongs to the new technology infrastructure of the information infrastructure part of the new infrastructure. This has provided fertile soil for the development of blockchain technology in China, which has also promoted many companies to invest in the research and development and application of blockchain technology.
From the application level, the current blockchain has also extended from a single digital currency application to various fields of economy and society, such as the financial industry, copyright protection, traceability and anti-counterfeiting, the energy industry, the sharing economy, the Internet of Things, and many other fields. . For example, in the context of normalization of epidemic prevention, the importance of how to ensure the safety of vaccines and the traceability of cold chain foods has become increasingly prominent. The use of blockchain technology can track the entire chain of product production, transportation, and distribution, and record non-tamperable on-chain records. This has become a popular and safe solution at the moment.
Generally speaking, the application prospects of blockchain in the financial field are currently the most promising, and related technologies are also developing fastest.
According to data released by IDC in March this year, the scale of China’s blockchain market is expected to exceed US$2.5 billion in 2024, and the compound annual growth rate (CAGR) in the next five years will reach 54.6%, ranking first in the world. And the market size is expected to remain the world’s second largest in the five-year forecast period. China will become one of the important regions driving the development of the blockchain industry.
It is foreseeable that the value of blockchain technology will not only be more efficient and secure in the application of existing businesses, but will also play a more important role in the new trust business model. Let us wait and see how big the market will be leveraged by the digital technology represented by the blockchain and change people’s lives.