The Chinese bank is looking to blockchain technology to increase efficiency and improve customer service for financial asset exchange.
A patent application from the Industrial and Commercial Bank of China (ICBC) outlining a blockchain platform intended to improve financial asset exchangehas been published. The institution is one of the world’s largest in terms of assets. The application was submitted in January and published on July 6.
The patent describes a system whereby once a participant has requested a transaction, an EDCC (or smart contract) will cause it to be validated by every node in the network, based on information such as “the ID of the buyer and seller, the commodity ID, the user balance, the transaction amount, the number of transactions, and one or several of the transaction times.” Once the bank’s preset number of nodes has validated the transaction, it will then be considered complete.
The blockchain platform is intended to improve the efficiency of the current system by removing intermediaries, increasing the speed of cross-border transfers, and improving the liquidity of financial assets.
The document states that the current chain of transactions built around a system of centralized credit has “some problems, such as high transaction cost, low execution efficiency, poor system reliability and low product flexibility, which have not satisfied the need of rapid circulation of financial products.”
The bank hopes this new blockchain platform will provide insight into how blockchain technology will be used in the banking industry as well as vastly improve customer service overall. Per the application, ICBC seeks to:
“provide an open, equal, and efficient financial product trading system, not only to promote the development of customer-centric financial products, but also to further broaden the customer’s financial trading channels … [and] bring new opportunities.”
China has researched the benefits and detriments of cryptocurrency and blockchain technology in the past. In May, it was reported that a subdivision of China’s Ministry of Industry and Information Technology (MIIT) was conducting a special study on how to create and implement international blockchain standards, and in June, a television program intended to educate Chinese citizens on blockchain technology aired on Chinese TV.