China Securities Times, which functions as a spokesman for Chinese financial regulators, confirmed that one of China’s largest banks had issued a residential mortgage-based securities (RMBSs) to the tune of 9.3 billion yuan, using the blockchain. In U.S. currency, this comes out to around $1.3 billion dollars. The Bank of Communications, founded in 1908, was the main issuer, with underwriters including China International Corporation, Commercial Bank of China, and China Merchants Bank.

One of the main advantages and reasons why many financial institutions are interested in blockchain technology is because it is an extremely transparent technology. The blockchain technology allows various parties to view up-to-date information and conduct due diligence in real time.

The Bank of Communications – which the multinational banking and financial services corporation, HSBC, the 7thlargest bank in the world, has a minority stake in – did not do this as a sudden move, but has actually been actively exploring how blockchain technology can enhance their services, and has been moving data since July to their Jucai Chain, which is its proprietary blockchain technology. It was developed in hopes that it simultaneously made issuing securities such as RMBSs simultaneously more transparent and efficient.

There are those that view this as a hypocritical move, considering that China has cracked down on cryptocurrency in general. Specifically, the country outright banned ICOs, or initial coin offerings, in September of last year. There are many in the cryptocurrency community who find it curious that China’s financial sector seems to understand how valuable blockchain technology can be, while simultaneously cracking down on the industry.

This is also emphasized by the fact that almost halfof China’s 26 publicly-listed banks had deployed some type of technology in 2017. Some of the institutions that utilized blockchain last year were the Bank of China, China Construction Bank, and the Agricultural Bank of China.

The country has taken an anti-cryptocurrency when it comes to ICOs, which has led to companies heading elsewhere, such as crypto-friendly nations such as Malta. Despite this, there are lawmakers that have championed the potential applications of blockchain. Even China’s banking regulator has admitted that blockchain can serve as a new way to share data more efficiently than ever.

It is clear that China’s banking sector is increasingly relying on blockchain, although no transaction of this size has ever taken place in the country until now. Recently, the Bank of China Hong Kong revealed that they used blockchain for almost all of their real estate valuations.

Logical enough, banks are understanding how revolutionary the technology can be – and are exploring new ways that they can improve their operations. Despite the fact that there is obviously a future for blockchain in China, it is clear that some kind of compromise must be made between authorities and businesses for the cryptocurrency culture in China to thrive.

The post One of China’s Major State Banking Groups Successfully Transacts $1.3B in Securities Using Blockchain appeared first on CoinSpeaker.

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