The China Banking Association says the platform has been designed to standardize and digitize interbank transaction information for trade and financial products. Photo: iStock
On September 4, 2017, the People’s Bank of China shut down local crypto exchanges over escalating concerns that unregulated assets, such as Bitcoin and Ethereum, allowed PRC residents to bypass the country's strict capital controls. Photo: iStock

China’s top three telecoms firms are teaming up to use blockchain to boost operations and security in the industry.

A statement was released last week by the China Academy of Information and Communications Technology (CAICT), a research body under the top-level Ministry of Industry and Information Technology. It outlined how three Hong Kong listed Chinese telecoms, China Mobile, China Unicom and China Telecom, have joined the CAICT’s Trusted Blockchain Initiative.

The focus for the three telecoms giants will be blockchain-based apps that relate to IoT (internet of things) data sharing and customer identity verification. The hope is for a reduction in operating costs and increased efficiency within the organizations.

Alongside CAICT, the initiative will be run by Huawei Technologies, the world’s largest telecoms equipment supplier. Allen Li, former Huawei engineer and boss of decentralized mobile network blockchain start-up QLC Chain, told local media that in the next three to five years, China can expect “to see more than 60 percent of telecoms services use blockchain technology. Blockchain will not only help telcos lower operational costs for things like user identification, billing and content delivery network, but it will serve as the best solution to improve network security.”

China Mobile, China Unicom, and China Telecom plans to roll out 5G in the next two years so efforts to drive down operational expenses and improve network security and identity verification will give these companies a competing edge in an already crowded market place.

The CAICT Trusted Blockchain initiative was launched in April with the aim of exploring blockchain in major sectors in Chinese industry. However the government’s heavy handed approach to crypto-currencies has slowed progress in other areas.

More than 200 Chinese businesses are already involved in the government initiative and the list includes ZTE Corp, payments provider Union Mobile Financial Technology, blockchain startups ChainNova and Qulian Technology. Internet giants Baidu, Alibaba Group, and Tencent also contribute for cyber security solutions.

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