China Merchants Bank International (CMBI), a state-owned subsidiary of China Merchants Bank (CMB), recently announced its partnership with blockchain network Nervos to jointly develop and launch decentralized applications (DApps) for financial services.
Nervos’ public, permissionless layer-one protocol Common Knowledge Base (CKB) provides a secure and trustless foundation, while its layer-two solutions enable unlimited scaling via smart contracts.
As CMBI explores blockchain technology to enhance its products and services, the firm plans to utilize Nervos Network and its native CKB architecture to power future decentralized finance applications.
According to Nervos Networks co-founder Kevin Wang, this partnership will enable CMBI to create a decentralized ecosystem with DApps that are both retail and institution facing. CMBI is exploring the tokenization of assets, payments, identity verification, trading and lending through blockchain.
“Basically what has mostly been under the traditional finance umbrella, they [CMBI] are going to experiment to put into decentralized applications,” Wang added.
CMBI has previously experimented with permissioned blockchain for internal purposes, while the partnership with Nervos is CMBI’s first project to tap into the public blockchain space, according to a spokesperson.
Compared to permissioned blockchains, the permissionless ones are “ideal for inter-bank or external client-facing applications where security and multi-party verification are needed,” the spokesperson said.
Wang has described CMB as early adopters of technology, saying, “They are way ahead of all the other banks that we know of, so they actually have done a lot of research internally, build pilot programs in that, and willing to jump in on the public side.”
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