- 2019.12.03 [Tue]
How to build a blockchain credit system for both investors and entrepreneurs
Blockchains may make it easier for venture companies to be listed. Currently, the investment situation in China is not ideal, and venture capital investment relies on national assistance. However, even venture companies that have just been established and have difficulty gaining trust are more likely to receive investment through blockchain.
ZYC Advisory provides financial management-based consulting services for pre-listed companies. This time, Mr. Osaka, editor-in-chief of AIre VOICE. interviewed Mr. Hu Ganxin, representative of ZYC Advisory and Mr. Zhang Weidong, a partner specialized in investment. The discussion covered how blockchain is driving corporate investment and giving companies opportunities.
Blockchain drives corporate investment
Osaka: Could you tell us about your work and past experience?
Hu: For the last 21 years, I was in charge of audit in various fields, and was also involved in operations management including company performance appraisals. That was how I discovered that Chinese companies generally lacked financial management skills. So I founded the company in 2018 to focus on corporate right gifting and consulting services.
Specifically, we provide pre-listing consulting services, such as checking the compliance of a company’s financial statements, and assist the company in entering the market.
Zhang: I am mainly in charge of the investment field and partnering with Mr. Hu in developing business. Since big data is a specialized field, we are also working on data rights issues.
When we click on the consent button to download the app, our personal information might be stolen, which is a serious problem. In future, I would like to incorporate blockchain-related laws and manage the ownership of data rights with blockchain.
Hu: The feature of blockchain is decentralization and non-tampering. As for our corporate consulting services, we would like to provide a company with financial data that cannot be tampered with using blockchain, and help it become a reliable company when it becomes listed.
Osaka: It seems that creating a credit system with blockchain can really improve the investment situation.
Hu: The investment situation last year was not very good. Since the credit system has not been created yet, the current venture capital investment is made possible with government aid.
As long as the credit system gets established, investors will not have to carefully examine the companies they invest in. It will be easier for them to invest. I think the blockchain is the most necessary factor for creating such a credit system.
Osaka: How did you form this idea?
Hu: I had some experience when I was using the “Alipay”. When I was so busy every day that I didn’t have time to go shopping, I decided to buy a camera online, but I didn’t receive the camera. Since the e-commerce platform I used didn’t provide any guarantee, I couldn’t do anything. Later, “Alipay” was introduced into the e-commerce platform “Taobao”, and the sellers will only receive payment from the buyer after the transaction has ended.
By having a credit system on the platform side, consumers can use online shopping with peace of mind. Of course, the development of Alipay and Taobao services requires a large amount of human resources and funding, but I can imagine that credit problems can be solved with blockchain.
Alipay is a credit system for consumers, but blockchain can build a credit system for businesses.
Working with the government is a future task
Osaka: Do you have any plans to make use of blockchain?
Hu: We have already built an e-commerce platform, and we plan to make a pre-investment examination with the data of the companies and provide it to investors. Member companies using the platform can use points to trade between member companies. When the number of member companies reaches a certain number, all tokens on the blockchain will enter our calculation system and we will be responsible for managing all the data.
This is how it works: the data is used as an analysis report for corporate business management, classified into interest-type and consumption-type, and presented to investors in the form of a third-party credit report.
We have a large investment financing platform behind us, so we can provide all the data required for making a credit report. For example, which company will raise an investing or financing request and when, which company has good trading conditions, and which company has the potential.
Osaka: It’s like completing a pre-investment examination through the blockchain.
Hu: We will also conduct after-investment monitoring .By linking tokens and blockchains to the living environment of the investment user, the usage status of the invested funds is automatically recorded in the database and users can monitor it anytime. Another advantage is that you can provide management analysis reports to companies on a regular basis.
Osaka: What role do you think blockchain and can play in AI corporate consulting?
Hu: I think, by introducing blockchain into financial reports held by accountants and connecting it to the IoT with AI, it will be possible to automatically create materials that no one can tamper with. Social fraud problems can be completely prevented. It will take a long time to achieve that, but it is certainly possible.
Zhang: The current problem is that blockchain and virtual currency is not welcomed by the Chinese government. Many blockchain companies that were originally established in China have moved to other countries, such as Cambodia, Mongolia, and Central Asia country.
Bitcoin and Ethereum are all dropping because the recent cryptocurrency market is not ideal.
If legal problems can be solved, blockchain and virtual currency will be trusted, the market will be activated, and the industry will be developed .To that end, I think we should proactively communicate with the government, deepen the government’s understanding of blockchain, and disseminate values that seek to realize a better society through blockchain.
AIre VOICE publishes the latest news on blockchain and features interviews as well as columns for people with various backgrounds. Please have a read.
Writer / Kaori Sugawara Editor / YOSCA Photographer / Ryo Kuramochi