Based on the recently revealed information, we all can make a conclusion about the passion of the second-largest bank by assets the Chinese Construction Bank (CCB) to blockchain. Sources indicate that CCB has introduced a refactoring platform that is to run totally on its own blockchain. The platform is aimed at corporate clients in the business of factoring and its goal is to improve operations and reduce risks and costs at the same time.
Factoring is a fund-raising model where invoices from businesses are purchased by buyers who are represented by factoring companies. This enables the businesses to raise funds and the third parties to spread their risk since a factoring company takes on all the risks associated with the invoice purchase. This, of course, comes after CCB had also introduced the second version of its international trade blockchain platform where letters of credit where issued for trade deals including international factoring deals and refactoring deals as well. The blockchain solution was introduced in October and is nicknamed “BCTrade 2.0”. Sources indicate that the blockchain international trade platform has been a success and about $50 billion of transactions have been conducted to date.
Trade has become digitalized through the implementation of BCtrade which is a platform that connects not only one of the biggest banks in China to more than 54 local state-run banks but also to foreign financial institutions as well. The innovations that the CCB is bringing to the blockchain space is also coming alongside reports that the People’s Bank of China (PBoC) is issuing blockchain-based bonds to the tune of about $2.8 billion. Sources indicate that the bonds are issued as loans to small and medium scale enterprises that are aimed at encouraging the development of blockchain technology platforms and systems within the country.
This comes amidst reports that the People’s Bank of China has announced its plans of testing its digital currency in two cities in the country. From all indications, it seems that the Chinese are taking over the decentralized finance (DeFi) space on a global scale. This has also made the Chinese to become the forerunners of the different use-case scenarios of blockchain technology.
It’s not as if the rest of the world has taken a backseat to the numerous applications of blockchain technology. The Europeans have sought to find a common definition of how best to use these new advanced concepts to improve not just the field of finance, but also all other fields as well.
The United States has already made their position clear on the Keep-Big-Tech-Out-of-Finance Act which has already indicated an anti-blockchain stance. However, who shall win the blockchain race remains unclear as innovation is never static.
Author: Christopher Hamman
Christopher Haruna Hamman is a Freelance content developer, Crypto-Enthusiast and tech-savvy individual. He is also a Superstar Content Developer, Strategy Demigod, and Standup Guy.
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