What is essentially the central bank of Hong Kong, the Hong Kong Monetary Authority (HKMA), has announced plans to launch a blockchain-based financial solution in collaboration with the fintech subsidiary of Chinese company Ping An, China’s second-largest insurer.
Big players in Hong Kong’s $9 trillion financial ecosystem will be brought on board, including banking giants HSBC and Standard Chartered. The project will be developed and headed by Ping An’s financial tech firm OneConnect which has already overseen the successful rollout of a similar system in China.
The project will involve 21 banks across the country and is aimed towards the reduction of bureaucracy and unnecessary paperwork for registering new businesses. By leveraging technological benefits provided by a blockchain platform the system will enable transaction times to be reduced by as much as 90 percent.
Similar smaller projects have been tested throughout this year by individual banks, most notably HSBC’s R3 Corda implementation. However, this is the first time a regulator has taken the lead to bring together individual institutions in an effort to improve financial trading implementations.
It is likely to be the largest financial blockchain-related initiative backed by a government and stands to further cement Hong Kong’s position as an economic superpower. Ping An already has technology in place amongst domestic Chinese markets utilizing blockchain solutions and intends to repurpose the same systems to support the Hong Kong project.
The system will be particularly attractive to smaller businesses which currently struggle overcoming obstacles involved with accessing advanced trading systems. Additionally, it reduces costs and works hand-in-hand with current programs to improve fraud detection.
Image From Shutterstock