With the rise of blockchain to the national strategy, financial institutions began to increase investment in the field of blockchain. At the same time, supervision is also tightening. In addition to the risk warning issued by the central bank, the non joint office of the cbcirc recently warned against illegal fund-raising in the name of “virtual currency” and “blockchain”. In this process, what is the regulatory focus of the CBRC? What role will commercial banks play as the middle tier of DCEP?

Chen Weigang, former vice president of the Party School of the CBRC and director of the board of supervisors of key state-owned financial institutions of the CBRC, told the Beijing news that the blockchain can solve the problem of opaque financial management, trust and fund income. In the process of implementation, the CBRC strictly supervises banks and insurance institutions in terms of capital investment, cash management and cash payment channels. At the same time, after the implementation of DCEP, the close relationship between money circulation and banks is reduced, and the competition among commercial banks may be more intense.

Strengthen the management of fund investment, and the funds obtained from speculation shall not be transferred to bank accounts

Beijing News: the non joint office of the banking and Insurance Regulatory Commission recently prompted to prevent illegal fund-raising in the name of “virtual currency” and “blockchain”. What are the regulatory priorities of the CBRC?

Chen Weigang: regulators should first protect the interests of consumers. Three parts of business are prohibited. The first is to prohibit banks from directly or indirectly flowing funds to false and illegal blockchain investment targets. Bank controlled investment companies are required to fully understand the scientific and technological quality of the invested company, whether to maliciously hype the blockchain concept, and whether to engage in illegal businesses such as ICO before investing funds.

Second, banks cannot provide payment, transfer channels and transaction accounts for projects that illegally raise funds in the name of “virtual currency” and “blockchain”. The most direct is that the funds obtained from speculation shall not be transferred to the bank account.

Third, the bank’s own financial technology innovation should also prevent false blockchain speculation. Banks can apply blockchain technology, but before application, they should fully evaluate whether the technology conforms to business logic, whether the company has sufficient qualification and whether it reaches the due level of risk control, so as to ensure the protection of consumers’ rights and interests.

Beijing News: the Ministry of industry and information technology recently said that it would work with the CBRC and other relevant departments to promote the organic combination of new retail, blockchain and industrial Internet. What role will bancassurance institutions play?

Chen Weigang: the CBRC has been actively guiding and supporting financial institutions to serve the real economy and small, medium and micro enterprises, and do a good job in Inclusive Finance. The practical application of blockchain technology in the fields of bank accounts receivable, bills and supply chain can improve the fairness and transparency of transactions, effectively eliminate black box operations and improve the trust of all parties to transactions. Taking new retail as an example, blockchain can be used to trace the origin, quality, customer and logistics of products. In the payment process upstream and downstream of the supply chain, the bank can realize automatic transfer of payment for goods by using the smart contract of blockchain, which not only improves the transaction efficiency, but also prevents the formation of triangular debt in the supply chain.

When applied to bank loans to small and micro enterprises, blockchain can play a more magical role. Banks’ loans to small and micro enterprises are most afraid of information asymmetry. Banks and insurance companies do not understand the real situation of enterprises, so that banks dare not lend and insurance companies dare not guarantee. After the application of blockchain, all affiliated enterprises, banks and insurance companies are on the same chain, and every move of the enterprise is reflected on the chain. The enterprise’s debt, production, sales, product quality feedback, turnover and net profit are clear at a glance. Insurance companies and banks have enough knowledge of the enterprise, so they have the confidence to serve the enterprise, Once a risk occurs, you can stop the loss in time. Therefore, at that time, the problems of difficult payment and expensive loan for good small and micro enterprises will not exist, but the life of poor small and micro enterprises will be more sad, which can also play the role of survival of the fittest.

Beijing News: the development of blockchain system requires a lot of investment. What about smaller banks and insurance institutions?

Chen Weigang: at present, big banks are still ahead in the implementation of blockchain technology. After all, they have stronger capital strength, more talents and wider application scenarios, such as industrial, agricultural, China Construction, transportation, recruitment and other large-scale banks, as well as small and medium-sized banks. As far as I know, Zheshang Bank (4.770, 0.02, 0.42%) It is better to apply blockchain technology to carry out supply chain accounts receivable financing.

I think that when the blockchain develops to a certain extent in the future, there will be standardized and standardized products, that is, open source software. Small and medium-sized banks apply open source software to popularize blockchain technology, that is, like using windons software, small and medium-sized banks do not need to develop a system by themselves.

After the implementation of DCEP, businesses are more free to choose deposit banks, which will intensify the competition of commercial banks

Beijing News: what role will commercial banks play in the implementation of DCEP?

Chen Weigang: in fact, the issuance of DCEP by the central bank is similar to the current process of issuing banknotes by the central bank. How did the money get into everyone’s hands after the money printing factory printed the money? Take payroll as an example, the unit will open an account in a commercial bank, and the money of the central bank will be given to individuals through commercial banks. For example, after the unit calls us the salary, we will receive a series of numbers. These numbers are real money and digital paper money. Different from the memory card in the bank, the money in the memory card is actually in the bank. When people go to the store to shop, they pay the money to the store. In fact, the personal account bank pays the money to the account bank of the store, It is a transfer between banks.

The difference of DCEP is that our wages are no longer put in commercial banks, but in people’s digital wallet, which is equivalent to the original bank card. When shopping in the store, people do not need to have a relationship with the bank. The digital wallet in the buyer’s hand can be transferred directly to the merchant’s digital wallet, realizing the point-to-point transfer of money. The merchant’s digital wallet receives real money, which needs to be deposited in the bank to earn interest. Because the circulation of money is not so closely connected with the bank, the merchant’s choice of the bank for deposit is more free, and the competition may be more intense for the bank.

Beijing News: after the issuance of DCEP by the central bank, what impact will it have on commercial banks?

Chen Weigang: after running DCEP, the operation system of commercial banks will be more complex, that is, a new DCEP system will be added under the original system. The most intuitive thing is that each merchant should add a new device to receive the money from the E-wallet. This is a device system that can pay and receive offline, and directly carry out point-to-point operation with customers.

Beijing News: is DCEP safer or safer for ordinary people?

Chen Weigang: any new thing has two sides, but from the perspective of development, it must be better and better. In terms of security, it is higher overall. Because e-wallets can have more forms of confidentiality than bank cards. In addition to passwords, they can have biological identification technologies such as fingerprints, face brushing, iris and voice, which can better judge whether they are used by themselves. Even if the password is lost and cracked, the thief can also be found, because the money in the E-wallet has a number. When you report the loss of your wallet, the money in your wallet will be locked and found when you reuse it. Therefore, the anti-theft function is better.

Blockchain can solve the problem of opaque income of financial management, trust and fund

Beijing News: what opportunities will blockchain technology bring to the banking industry?

Chen Weigang: the most direct positive industry brought by blockchain technology is banking, because it can improve the bank’s risk control ability. The core value of the blockchain is to establish a better trust mechanism, and the bank itself is the most honest place. Therefore, people (64.830, 0.47, 0.73%) dare to give money to bank deposits or financial investment, which is their trust in the bank. However, due to the asymmetry of information, some financial institutions have dishonest behaviors, such as trust and financial management. Some financial institutions fail to inform consumers of the actual income, falsely claim that the income is low when the actual income is high, or simply say that the product has lost money. This situation also exists in the fund and trust products sold by banks on a commission basis. Under the current conditions, it is difficult for consumers to check accounts even if they are suspicious. However, by synchronizing the relevant data of asset management products to the blockchain, consumers can clearly see the direction of each sum of money, so there is no fraud problem. Therefore, blockchain technology is to protect financial consumers and investors.

For the privacy disclosure that consumers are worried about, in fact, the confidentiality mechanism of the blockchain can be defined independently, just as your wechat circle of friends can set open permissions. For example, the personal information in the bank can be set to multiple levels, such as national security department, public security, discipline inspection and supervision department, regulatory department, etc. you can find the most complete information. You don’t need to open so many permissions to ordinary enterprises or individuals. You can see the information related to your transaction in the process of transaction.

Another landing scenario is supply chain finance. Through blockchain technology, all upstream and downstream enterprises can realize honest transactions through smart contracts. For example, through blockchain, they can turn white notes into RMB. In the blockchain environment, the debit note is through the smart contract. When the conditions set for the debit note are met, the blockchain will automatically cash the contract. This white note has the same value as RMB. If the procedure of automatic transfer between borrowers and lenders under certain conditions is set in the supply chain, there will be no malicious debt evasion.

In addition, the scenarios that can be implemented include authenticating bills on the blockchain, eliminating bill fraud and fraud, and even international settlement through the blockchain to improve the transfer efficiency between international trade.

Beijing News: what other businesses in the banking and insurance fields have the potential to be enabled through blockchain technology, but have not been implemented yet?

Chen Weigang: insurance can also use blockchain, such as aircraft delay insurance. At present, in many cases, insurance companies will use various excuses not to compensate, but in fact, this is unreasonable and violates the original intention of setting up delay insurance. Using blockchain, it can ensure that the system will automatically settle claims under certain circumstances, such as the absolute time of aircraft delay, without the consent of the insurance company.

However, the implementation of such technologies is difficult. In the past, banks and insurance were centralized operations, institutions were the strong side and consumers were the weak side. Through the blockchain, decentralization was realized and consumers’ voice was enhanced. For banks and insurance institutions, their rights would be greatly weakened. Therefore, it is difficult to promote such products, and the regulatory level can only encourage institutions to promote rather than force institutions to use them.

Beijing News: what are the trends in the application of blockchain in the financial field?

Chen Weigang: I think there are ten major trends in blockchain: 1. The application of blockchain industry is accelerated and diffused from digital currency to non-financial field; 2. Enterprise application is the main battlefield of blockchain, and alliance chain and private chain will become the mainstream direction; 3. Diversified technical solutions will be promoted to continuously optimize the performance of blockchain; 4. The combination of blockchain and cloud computing will become closer and closer; 5. Blockchain security issues are becoming increasingly prominent, and security protection needs overall consideration of technology and management; 6. The cross chain demand of blockchain is increasing, and the importance of multi connection and interworking is prominent; 7. Blockchain competition is becoming increasingly fierce, and patent competition has become an important field of competition; 8. Blockchain investment continues to be popular, and the accumulated risk of token crowdfunding mode deserves serious attention; 9. The conditions of blockchain technology for supervision are becoming more and more mature; 10. The importance of standardization, standardization and open source of blockchain is becoming increasingly prominent.

Beijing News reporter Zhang Shuxin

Responsible editor: CT

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