China’s central bank-backed blockchain platform starts trial in Shenzhen

Source:Global Times Published: 2018/9/12 22:03:40

A trade and finance blockchain platform, backed by the People's Bank of China (PBC), the country's central bank, was officially put into trial operation in Shenzhen, South China's Guangdong Province, reported on Wednesday.

The platform, named the "Guangdong-Hong Kong-Macao Great Bay Area Trade Fi-nance Blockchain Platform," will be used to explore capital opening-up in cross-border transactions and tackle financing problems for micro- to medium-sized enterprises, the report said.

"China has been cracking down on activities using virtual currencies, but blockchain is a quite advanced technology which has been adopted by many countries. So China will definitely not lag behind," Li Chao, an analyst at Beijing-based consultancy iResearch, told the Global Times on Wednesday.

"Blockchain technology could also ensure a more efficient and safe information-sharing system, and it is expected to reduce the financing costs for micro- to medium-sized en-terprises," Li said.

For example, it might take more than two weeks to complete a round of trade financing, but will only take about 20 minutes through the blockchain system, according to the re-port.

"Previously, trade financing costs for micro- to medium-sized enterprises were about 7 percent to 8 percent, but the blockchain system could cut the cost to less than 6 percent," the report said, citing Xu Honghui, vice president of the transaction banking division of Ping An Bank.

However, Li noted that to update existing systems to those adopting blockchain tech-nology would be quite expensive. Launching the new system in a new finance area such as the Greater Bay Area is quite a wise choice, and also a good start, Li said.

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