The Chinese city of Shanghai has entered into a partnership with six banks in the city. The “blockchain alliance” wants to use blockchain technology for global trade in the city. This was announced by The Global Times on November 7.
Blockchain has previously been used in several free trade areas in China, says Chen Huifang, professor at the College of Information Science and Electronic Engineering. He explains:
Blockchain technology increases the reliability of information, which improves the efficiency of customs clearance, reduces costs and promotes trade promotion.
Qi Hong, vice director of the China Construction Bank, states that the technology is still in its infancy and therefore cannot be used on a large scale:
We now use blockchain sporadically for financial products rather than the entire financing chain, and the public does not have a good understanding of technology when it comes to financing. But I think the government’s call for blockchain construction will help push the application of technology in a more comprehensive way.
The parties will jointly investigate the use of blockchain for Shanghai’s “E-port”. In this way, the technology will be used for international trade that takes place in Shanghai.
The positive developments surrounding blockchain in China are not entirely unexpected. The president of the country, Xi Jinping, called technology one of the most important technological innovations.
The Chinese government recently released 25 instructional videos that introduce different concepts such as blockchain, bitcoin (BTC) and ethereum (ETH). In addition, the Chinese government decided not to ban cryptocurrency mining.