China isn't known for respecting its people's privacy. With the many surveillance cameras, the country has been tracking its citizens to supervise their lives, as well as to manage their social credit system and other digital technologies.
And here, the country has passed a law that will regulate cryptography in the country, for both government and private uses, which will take effect on January 1st, 2020.
At this time, the officials didn't detail the law in the announcement, but according to the official Xinhua news agency, the law is aimed at "facilitating the development of the cryptography business and ensuring the security of cyberspace and information".
The law classifies cryptography into three different types: core, common and commercial cryptography.
Core and common cryptography will be managed by authorities in the subject, and will be used to protect China's confidential information such as state secrets.
And as for commercial cryptography, it is meant to protect information that isn't confidential. This technology can be used by citizens, legal personnel and businesses in accordance with China's laws.
The use of this encryption "must not harm the state security and public interests." People who fail to report security risks they see, or who offer cryptographic systems that "are not examined authenticated," will be punished.
To do that, China's institutions are working on a cryptography method to establish "management systems" that will in turn guarantee the security of that encryption.
But considering China's mass surveillance on digital conversations, the rules can force companies to both store data locally as well as turn it over on request. Likewise, the government is given the power to shut down services or entire products in response to security threats.
In other words, the Chinese government is giving itself the ability to obtain data that is not encrypted, and can give sanctions to those services that shield information from its prying eyes.
At this time, China's cybersecurity laws are already set to punish the use of encryption deemed to threaten the state.
The advantage of this law, is allowing businesses to better protect themselves.
Considering that many businesses have had their sensitive information leaked to the internet, this cryptography law can make both Chinese companies and the government to work with each other to protect their digital assets.
China in passing the law for cryptography, is also to pave the road for establishing its own cryptocurrency.
China's central bank is already having a research team, assembled in 2014, to explore the launch of its own digital currency to cut the costs of circulating traditional paper money, and to boost policymakers' control over the country's money supply.
According to a senior central bank official, the proposed digital currency would be similar to the proposed Facebook's Libra, and that it can be used across major payment platforms in China, such as WeChat and Alipay.
This is in line with what Chinese President Xi Jinping said.
The President said that the country should accelerate the development of blockchain technology as a core for innovation.
