The Bank of China’s chief information officer recently shared details on the bank’s blockchain efforts as he unveiled plans to boost fintech spending, according to local news reports.
Liu Quiwan said the state-run commercial bank, which is distinct from the central bank of China, will increase investing in a range of fintech tools to more than 1% of its annual operating budget, though the exact amount was unclear, China-based The Paper reported last week.
Speaking at a press conference in Beijing, Mr. Liu said the bank is currently running a dozen pilot projects using blockchain, the technology best known as the record-keeping system behind cryptocurrencies, the report said.
By the end of the year, he added, the bank will have completed a roll out of cloud computing, big data and artificial intelligence platforms, the report said.
International Data Corp. estimates that global corporate spending on blockchain software will reach $2.1 billion this year, up from $945 million in 2017, led by distributors, retailers and manufacturers.
Yet adoption of blockchain across the corporate world appears to be moving slower than expected.
Only 1% of 3,138 CIOs at firms in a range of industries said they had “any kind of blockchain adoption” within their organizations, according to a global survey earlier this year by Gartner Inc. While 43% of respondents said blockchain was on their radar, 34% said they had “no interest” in testing or developing it, the survey found.
U.S. banks have generally lagged behind their counterparts in China when it comes to the use of blockchain and other disruptive technologies, according to Kevin C. Desouza, a professor of business, technology and strategy at Queensland University of Technology’s School of Management.
“There is a greater emphasis from all sectors in China to leverage this technology to transform all aspects of civil society,” Mr. Desouza, who is also a non-resident senior fellow at the Brookings Institution, told CIO Journal.
“In the US, we have not seen a similar intensity in terms of a coordinated effort between public and private sectors nor the levels of R&D investment,” he added.
J.P. Morgan Chase & Co. earlier this year unveiled a prototype of a blockchain platform aiming to cut costs and facilitate smoother transactions within capital markets.
J.P. Morgan, Banco Santander S.A. and Bank of New York Mellon Corp., last year joined Microsoft Corp. and other tech giants in forming a consortium aimed at experimenting with the use of blockchain in financial markets.