China, which is known for its ambiguous attitude toward blockchain and cryptocurrencies, is not wasting time. This week, the People’s Bank of China has begun pilot-testing a blockchain trade finance platform which aims to create a specialized ecosystem.
The platform which is called the Bay Area Trade Finance Blockchain Platform was presented this Tuesday in Shenzhen’s financial institutions for a series of tests which will end once a specific result has been achieved.
“After nearly two months of closed development, Ping An Bank, Standard Chartered Bank, and BYD successfully reached the first phase of the Bay Area Trade Finance Blockchain Platform Project. The first phase of the project has been deployed online and entered the trial operation phase,” the report by 21st Century Business Herald said.
According to it, the project is a result of cooperation between the PBoC’s Digital Currency Research Lab and the central bank’s Shenzhen branch. The area of the test encompasses such key regions as Macau and Hong Kong. Other stakeholders include the Bank of China, the Bank of Communications, and the China Merchants Bank.
The PBoC notes that the finance platform “is designed to provide seamless and efficient interbank transactions.” Its primary goal is to help small and medium enterprises (SMEs) to gain access to various financing options. Its proponents expect the platform to “effectively promote the formation of market trust mechanism, better serve the real economy and help banks to conduct business authenticity audits and reduce business costs.”
Its other provisional merits include improving business efficiency, preventing and controlling business risks. The project could also create a trade finance ecosystem which will strengthen cooperation with various institutions.
The news comes after China, where ICOs and cryptocurrencies have been once again banned this month, has published an official guide for members of its ruling Communist Party. The book is titled “Blockchain – a Guide for Leaders.”
Ye Hao, president of the People’s Daily newspaper, said “The biggest significance of blockchain technology at present is its operating mechanism. Through the ingenious combination of technologies, it can achieve the fair distribution of resources, thus ensuring that the community has consistent goals, and members have behavioral norms. This provides us with a new approach to examine problems, and come up with solutions.”
Previously, Xi Jinping, the president of China, called blockchain a breakthrough, saying that his country should concentrate on becoming the global center of science and innovation. At the same time, another governmental official softened its capacity to innovate.