Postal Savings Bank of China (PSBC) announced on Tuesday it has teamed up with IBM to launch its blockchain-based asset custody system. As part of its work, the bank has also successfully executed more than 100 real business transactions on the blockchain since the system went live in October 2016. PSBC also used the Hyperledger Fabric to create the first deployment in China to apply blockchain technology to asset custody in the financial industry.
According to PSBC, the blockchain solution enables the real-time sharing of information by multiple parties, eliminates repeated credit verifications, which reduces the operation process by about 60%-80% and helps make information exchanges more efficient. The smart contract and consensus mechanism integrates investment compliance verification regulations into the blockchain and ensures that transactions are completed after contracts are meet and a consensus is reached. The bank also noted that the immutability and encryption built into the blockchain help to keep all account information remain secure while allowing the quick sharing of necessary information by transaction participants.
Lyu Jiajin, President of PSBC, stated:
“Blockchain technology has the potential to eliminate the trust frictions in financial business activities at a very low cost and creates trust and enables the efficient exchange of information for all the parties involved in a transaction. 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.”
Chen LiMing, Chairman, IBM Greater China Group, added:
“The successful launch of PSBC’s blockchain-based asset custody platform demonstrates the high impact the technology can have on the financial industry. As the technology evolves, we expect to work with PSBC to define and develop new solutions, drive adoption of blockchain in more lines of business and support more organizations in China and around the world as they build their blockchain ecosystems and create a more efficient and trusted business environment.”