(Yicai Global) Jan. 11 – With the phenomenal worldwide development of "blockchains," which enables exchange of digital assets such as bitcoin, over the last couple of years, Chinese banks are gearing up to introduce blockchain technology applications in China.
The Postal Savings Bank of China Co. (PSBC), in cooperation with International Business Machines (China) Co. (IBM China), announced the launch of a blockchain-based asset custody system.
The system has executed more than 100 transactions in an actual business environment, involving buying and selling bonds since it went online in October 2016, a PSBC statement said.
In partnership with IBM China, the Postal Savings Bank used Hyperledger Fabric to apply the blockchain technology in an actual production environment. Hyperledger project is an open source collaborative initiative to advance cross-industry blockchain technologies.
Blockchain is characterized by its data traceability, its ability to prevent illegal modifications, and its highly efficient credit transmission and digital privacy protections, making it the ideal core accounting technology in the internet era, said Chen Liming, chairman of IBM Greater China.
It is the first application of the blockchain technology in the core business system of a Chinese bank. Asset custody represents a CNY4 trillion (USD577 billion) business as one of PSBC's core businesses.
"This technology has the potential to fundamentally transform the financial industry. Today, with a booming fintech and business innovation in the financial industry, we expect to join hands with more financial institutions to build the ecosystem for a financial industry based on blockchain technology," said Lyu Jiajin, president of PSBC.