Blockchain Might Facilitate Quicker Asset Exchange For The World’s Largest Bank
BTC Wires: The largest bank in the world, in terms of total assets and one of China’s Big Four state-owned commercial banks, ICBC (Industrial and Commercial Bank of China) has filed an application in January for a patent of a blockchain system to be used for the exchange of financial assets. As per a report published in South China Morning Post, ICBC held more than $3.6 trillion (RMB 24 Trillion) in terms of assets at the end of 2017 and took over Well Fargo as the largest bank in the world. Last Friday there was an announcement from the bank that they envision a platform wherein the participating institutions will be functioning as nodes of a distribution network.
The aim of the system is to get rid of intermediaries from the present system and enhance the liquidity of financial assets. According to ICBC, the need for this system came up due to flaws in the current system which made it costly and slow, when information was to be shared between institutions for transactions related to financial instruments and regular payments including metals and futures.
A smart contract would be triggered when a user from a participating institution would initiate a request, and the transaction would be validated on the basis of information provided such as account name, balance, transaction amount, etc. The transaction would be completed only if adequate validations, above the specified threshold, have been received from the nodes.
The documents said that “The traditional transaction chain that is built around a centralized credibility system incurs problems like the high cost, low efficiency, low stability, as well as inflexibility. This impedes the bank’s launch-to-market process to meet the rapidly growing demand for innovative financial products.” As per the China State Intellectual Property Office, the above-mentioned patent from ICBC is the most recent filing associated with blockchain technology. Previously, ICBC has filed for a patent to verify user information over a distributed network based on the blockchain.