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I need to shut up about Ant Group, as I’ve blogged a lot about them lately. However, with an IPO coming up and news coming out daily almost, it’s hard to ignore some of their activities.
One activity that really hit me when it was released in July was the rebranding of all of their blockchain efforts to AntChain. The reason it hit was due to this performance to launch it (above).
As you can see, the company has a sense of humour.
So, what is AntChain?
It’s all the things that Ant Group are doing with blockchain, to which they are truly committed (as I mentioned when covering their strategy back in 2018).
Jack Ma, who controls about half of Ant’s voting power, claimed back then that blockchain technologies would “reshape the world’s financial system” and Mr. Ma’s confidence got a boost after China made blockchain a national strategy in 2019 and has since crowned it a national infrastructure.
Demonstrating this technological leadership is all well and good, but I always ask: blockchain, huh, what is it good for?
Well, Ant Group and others are proving it’s good for absolutely something. Since first entering into trials of blockchain technology in 2015 Ant, and their sibling Alibaba, hold more blockchain patents than any other company in the world, including IBM and JPMorgan Chase. The company has topped the blockchain patent charts for the past four years. In fact, as you may have noticed, China holds more blockchain patents and projects than any other country in the world (you should see what they’re doing on AI).
Projects have included everything from making donations to charities to providing connections between public services departments, banks and citizens to share information such as title deeds, credit history, and mortgage applications. A really interesting one is a partnership between AlipayHK and GCash, who offer instant cross-border remittance services between Hong Kong and the Philippines using blockchain as the underlying infrastructure.
Another under-observed piece of news when they launched AntChain was the announcement of the “Ant Blockchain Open Alliance”, a consortium aiming to bring small businesses and developers to the industry, and helping them build applications on top of Ant’s blockchain at a lower cost. Ant Group claims that this has resulted in over 50 cases in production powering more than 100 million transactions a day.
Anyways, the reason I am blogging about this today is a major update released this morning that strikes to the heart of our core financial businesses: cross-border trades between business, particularly small businesses (SMEs or Small to Medium Enterprises if you prefer).
A lack of trust between trading partners across countries has traditionally made it difficult for many SMEs to do business on a global basis. For buyers and sellers alike, this lack of trust often leads to delays in shipments, payments and settlements, which in turn places even more pressure on SMEs’ financial positions and cashflows.
Banks that support global trading by SMEs have also faced a longstanding challenge of verifying the authenticity of orders, the identity of traders and the relationship between payee and beneficiary, which has increased banking costs.
Today’s announcement from Ant Group is therefore to offer a new service called Trusple, a name which may sound weird but is based on the concept of “Trust Made Simple”.
Trusple works by generating a smart contract once a buyer and a seller upload a trading order on the platform. As the order is executed, the smart contract is automatically updated with key information, such as order placements, logistics, and tax refund options. Using AntChain, the buyer’s and seller’s banks will automatically process the payment settlements through the smart contract. This automated process not only mitigates the intensive and time-consuming processes that banks traditionally conduct to track and verify trading orders, but also ensures information is tamper-proof. Further, successful transactions on Trusple enable SMEs to build their creditworthiness on AntChain, making it easier for them to obtain financing services from financial institutions.
Trusple leverages AntChain’s key technologies including AI, Internet of Things (IoT), and secure computation, to build trust among multiple parties.
This will be interesting as it is one of the few ideas for a global blockchain service that might actually take off. We shall see. Meanwhile, these areas are all being discussion in depth at Ant Group’s INCLUSION conference on fintech in Shanghai this week. Find out more here.