China central bank to deploy a blockchain system to digitize paper checks

August 7, 2018

According to Finance News on June 5, the People’s Bank of China (PBoC) has working on a blockchain-based system that digitize paper checks issued by local enterprises. Through this platform, they hope that the checking procedure would prevent fraud datas as well as cut down the costs for paper printing.

In a sharing of Di Gang, an official at the bank’s digital currency research department, it took China one year to research and develop the infrastructure of this system using blockchain technology and smart contracts. In 2007, the agency has successfully tested its prototype in a virtual sandbox.

A bottleneck of the existing system is so many intermediaries which may take over the role of issuing checks from traditional banks and may also bring associated risks of fraud or counterfeit. Afterwards, fake checks can be rotated among banks and perhaps can threaten the integrity of financial data.

Developed with consensus algorithm that meets the short-execution-time requirements of financial services, the platform can tokenized checks while transactions can evoke smart contracts without interference.

Although in 2007, China has announced to forbid all cryptocurrency trading and ICOs activities, this country’s governors have been very eager to adopt blockchain technology itself. Also in last year, China registered many more blockchain patents with the World Intellectual Property Organization than any other countries in the world.

In this May, President of China Xi Jinping stated at the 19th annual conference of the Chinese Academy of Sciences in Beijing that blockchain is one of many breakthrough technologies that can accelerate various large-scaled applications

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