The official opening ceremony for the launch of a new Bank Letter Blockchain Services Platform (银行函证区块链服务平台) developed by peak industry bodies in China was held in Beijing on 18 December.
Over 100 banks and several dozen accounting firms have already submitted applications for inclusion in the platform, which was developed by the China Banking Association (CBA) and the Chinese Institute of Certified Public Accountants (CICPA) in collaboration with the China Construction Bank’s Bank Letter Blockchain Services Platform.
Liu Fushou (刘福寿), chief lawyer for the China Banking and Insurance Regulatory Commission (CBIRC), said that multiple incidents of fraud on Chinese capital markets over the past several years had prompted the central government to push for measures to improve the security and digitisation of bank letters.
CBA deputy-head Pan Guangwei (潘光伟) said that the platform provided pivotal advantages in three key areas:
- It converts the offline model of diffuse correspondence into a centralised online model which incorporates application, authorisation, issuance and reply into a single online process. This improves the efficiency of letter processing, resolves the problem of fraud associated with traditional paper-based correspondence, as well as removes the amount of activity required from accounting firms, banks and parties under auditing.
- When it comes to security, the platform seeks to achieve information separation and confidentiality and protect the data of banks and accounting firms by only retaining information from the letter transmission process, without retaining data from letters themselves. The platform also possesses a “financial-grade secure protection environment,” and can provide 24-7 secure operation.
- The platform makes use of ICBC’s Xi-Chain (工银玺链) technology, which has been certified by the Ministry of Industry and Information Technology as a reliable blockchain.