One of the world’s largest banks – the Industrial and Commercial Bank of China (ICBC) is looking to adopt blockchain technology to speed up the processing time of transactions.
The patent was filled in January 2018 and published on 6th July. As described in the document, the bank plans to create a platform by which the institutions involved will be able to form a distributed chain of nodes.
The transaction will be automatically validated
According to the patent, once an institution participant requests a transaction, the system which has built-in smart contracts will automatically check and approve the transaction, collecting individually from the customer the required data such as account balance, name and transfer amount. The transaction is completed when it receives the required number of approvals from the participating nodes. Thresholds will be set by the bank.
It hopes to eliminate the intermediaries
The purpose of this project is to eliminate the intermediary parts and to “improve the liquidity of financial assets“. The Industrial and Commercial Bank of China has explained in the document that interest in such a platform has arisen as a result of the slow and expensive system in which interbank and cross-border transactions are processed.
“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,” the filing states.
This is the latest bank’s filling linked to blockchain technology, as reported by the China State Intellectual Property Office. According to Chinese media, the financial institution is also looking to form a blockchain-based platform to validate user information via a distributed protocol.