19.01.2021

China Introduces Blockchain-Based Identification System for Cities

On Nov. 4, Chinese daily tabloid newspaper Global Times reported that the newly developed identification system was jointly launched by three institutes in the city of Shijiazhuang.

China continues to up its blockchain game with an independently developed blockchain-based identification system for cities as part of its smart city infrastructure.

The blockchain-based identification system will assign a unique, global digital ID to Chinese smart cities, aiming to improve the connectivity and data sharing between these cities. Smart cities across China have been able to apply for their own city identification code since Sunday.

Zhang Chao, director of the Zhongguancun Industry and Information Research Institute of Two-dimensional Code Technology, said that the system was developed by China, adding:

“The system will be independently distributed and managed by China, with a unified distribution rule, a resolution of distributed storage and tamper-resistant code.”

China has been focused on smart city development for several years, as new and more complicated challenges arise from an increasingly urbanized population.

Smart cities pop up across the globe

Smart cities employ and integrate a variety of technologies to make municipal operations more efficient, including self-driving cars, renewable energy, energy-efficient buildings and communications systems.

In July, the United Arab Emirates unveiled its “Smart Dubai” initiative, which aims to make the metropolis a world leader by becoming the “first city fully powered by blockchain by 2021,” and enhance everything from health care and education to traffic management and environmental sustainability.

A month later, a Singaporean startup, Limestone Network, announced a new blockchain-based smart city project for the Cambodian capital, Phnom Penh. Slated for completion by early 2022, the project will on-board various partners such as ride-hailing apps, financial institutions, retail brand owners and data analytics firms. Over the course of the next five years, the startup intends to roll out similar smart city projects across South East Asia with the cooperation of local governments.

In September, the IOTA Foundation published a 19-page study “Towards Open & Transparent Cities” which is currently collaborating with Taiwan’s capital Taipei and with the European Commission-sponsored CityxChange project to further study the idea of smart cities.

China Injects $4.7M Into Central Bank’s Blockchain Trade Finance Platform

The Chinese government has earmarked additional funding for a blockchain-based trade finance platform developed and led by the country’s central bank.

The People’s Bank of China (PBoC) is to receive 32.35 million yuan (around $4.7 million) in “special funding” from the government over a three-year period for research and development into the trade initiative, officials confirmed to local media.

Known officially as the Bay Area Trade Finance Blockchain Platform, banks and businesses store order, logistics and transaction data on the system to create new transaction efficiencies. It’s also said to provide regulators with greater oversight and gives small and medium-sized enterprises (SMEs) access to more sophisticated financing tools.

Led by PBoC’s Digital Currency Research Lab, the trade finance platform is available to businesses based in Shenzhen, a mainland city neighboring Hong Kong. Major commercial banks, including Bank of China, Ping An and Standard Chartered, were invited to trial the platform when it entered the public testing phase in September 2018.

In January, Xinhua reported the platform was used by a network of 38 banks with total combined volumes exceeding 90 billion yuan ($13 billion). The new funding from Beijing is expected to help PBoC drive adoption for its trade finance platform among businesses.

A report from McKinsey said the platform could “create significant new opportunities” for banks, SMEs and service providers. As well as lower interest rates, analysts estimated loan approval times could fall to as little as 20 minutes.

Chinese President Xi Jinping said last autumn the country had to “seize the opportunity” when it came to blockchain technology, including increasing government investment and development in core technology areas.

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