New Blockchain Alliance By Chinese Authorities Aims to Improve Trade Finance
- China is almost ready to release their national digital currency, which has been in development for five years.
- Chinese President Jinping has voiced public support for the progress of blockchain technology.
Blockchain technology is continually finding itself in different use cases, and the municipal Shanghai government is setting out to improve the use of this fintech for global trade. The collaboration is between the authorities and financial institutions, establishing an alliance that will improve the operations for trade finance. According to reports by The Block and Global Times, the members of the alliance presently include (but are not limited to) the Shanghai Municipal Commission of Commerce, Shanghai Customs, the People's Bank of China, and the Bank of Communications.
Ye Jian, a general administration official at Shanghai Customs, stated,
“This is the first blockchain application project in customs. China upholds multilateral trade and constantly improves its business environment by seeking technological innovation.”
There are already multiple free trade zones in China that have applied blockchain technology, allowing them to reduce the cost and speed of operations, while offering digital trading options.
In China, blockchain has been a popular technology, especially considering the public support from President Xi Jinping for it. Jinping stated China should be taking on a leading position in its ongoing development. Following five years of ongoing research and development, China is almost prepared to launch their own government-based digital currency.
As far as blockchain technology, Qi Hong of the China Construction Bank Shanghai branch says that the tech is still in an early phase of experimentation.
“We now use blockchain in sporadic financial products instead of the whole finance industry chain, and the public doesn't have a sound understanding of the technology when it comes to financing. But I think the government's call for blockchain construction will help push the technology's application in a more comprehensive way.”
Yesterday, Hong Kong established a partnership with mainland China for a blockchain project that will help with trade finance operations.