Client’s Perspective: Director from Soochow Securities Analyzed Trias Blockchain Solutions Trias Follow Feb 28 · 5 min read

This article is a recap of a recent AMA held by BlockMania.

The theme of the AMA was “The advantages of blockchain applications in the securities industry.” Zhihao Zhang, R&D Associate Director of the information technology headquarters of Soochow Securities, and Xuming Chen, Co-founder and product director of Trias, shared their views on the blockchain applications in the securities market, discussed blockchain application examples in the securities industry, analyzed the architecture of blockchain applications in the securities industry, and looked forward to future possibilities regarding blockchain applications in the securities industry.

Q1. What are the advantages of blockchain for the securities industry compared with other technologies?

Zhang: Our early contact with blockchain technology was mainly to see the technology itself for us, that is, the significance of distributed consensus algorithm.

Breakthroughs in the centralized environment of the traditional financial industry using distributed ledger, such as using blockchain technology to handle the large number of exceptions and the backup and recovery work involved in traditional business systems, using the consensus mechanism to ensure that messages are synchronized to each node, parallelizing serial tasks, and reducing system integration, operation, and maintenance costs between nodes — these issues are fundamentally a process of evolution. That is why we started blockchain storage and deployment early.

Q2. Can you briefly introduce the key technical indicators of the blockchain technology required to serve Soochow’s application scenarios? How is Trias blockchain technology implemented?

Chen: Soochow Securities, a large leading and mature securities company, has a set of very standard and strict information management requirements and indicators. Trias blockchain is realized by the following.

1. By using the heterogeneous consensus algorithm of trusted computing to reduce the cost of consensus and optimize nodes, improving the speed of consensus.

2. Analyzing each change behavior through a combination of trusted computing and DevSecOps, from the source phase of the software, and storing it in a shared and traceable chain.

3. Using trusted computing to measure and verify the whole user operation environment based on access of external equipment and data through traditional mining software or wallet access.

The status of the user’s operating environment is verified 24/7. With even a byte of non-white-listed change, the behavior and nodes of the non-trusted external chain can be found, which solves the problem of low access and damage cost in existing blockchain technology.

In conclusion, our core goal is to create secure, efficient and stabile solutions. For example:

We worked on log auditing earlier. The main object was to reduce the impact on core tasks such as securities trading as much as possible, and to make tamper-proof records of operating status, operations and other processes used for Soochow’s internal organization, and also forming objective proof for industry supervision and user inquiry. Its main technical features take into account concurrency, compatibility, and stability requirements.

The innovations of this system are as follows.

1) Continuous improvement of the combination of trusted security and artificial intelligence for the base-level financial information system. Operation and maintenance of the whole closed-loop of the chain system is continuously optimized to improve user business continuity, experience and security through collection, monitoring, analysis, prediction, and summary over the whole life cycle of the financial operation and maintenance system.

2) The project uses trusted security, AI, and other technologies, and solves frequent system operation problems in the industry such as slow fault detection, difficult positioning, poor prediction ability, and difficult capacity management. The system improves business continuity and user experience, and reduces the economic loss caused by system failure, effectively protecting investors’ trading rights and interests. These achievements have great economic and social benefits for industry development and investor protection, and good promotion value.

In sum, Trias actively helped Soochow Securities build its security and blockchain practices. Its applications in securities have transformed and upgraded blockchain practices within the financial industry.

Q3. Does Soochow Securities have further innovative practice plans in blockchain application? Can you give us some specific examples?

Zhang: Soochow Securities leads the securities industry. We also have good cooperation and communication with Shanghai Stock Exchange and Shenzhen Stock Exchange in blockchain technology, and we’ve won technical research awards in many industries.

For example, our log audit alliance chain solution in the securities industry uses blockchain to collect, verify, upload, analyze, query, and maintain traceability of the companies’ logs, improves the efficiency of supervision query and analysis, and verifies the authenticity of logs.

We hope to apply blockchain to finance by building technologies early and through our technological research. Therefore, Soochow Securities will continue to carry out in-depth blockchain promotion and practice in the future. The core industry driver is blockchain + asset securitization.

Q4. Can you describe the development prospects of blockchain technology in the securities industry, possible innovative applications, and key upcoming challenges?

Zhang: Many industries are now beginning to pay attention to investment and practice in blockchain technology, including the securities industry. This will greatly promote the development of the technology, and subsequent innovation and application in blockchain will continue to develop.

At the same time, we also see potential challenges in terms of consensus efficiency, decentralized business scenarios, and regulatory requirements, especially in terms of the security and stability of blockchain technology in financial scenarios.

For example, information transmitted and stored in the securities information management system is extremely important and highly confidential. Data theft or system failure may have serious consequences.

In addition, each company’s data is stored in its own computer room, which is not conducive to regulation. Blockchain technology can be applied to sharing and transmitting key security data over its whole life cycle, fundamentally improving its transparency, reliability and security. These are very good fintech and regtech propositions with significant economic and social benefits for industry development, regulatory innovation, and investor protection.

Q5. Can you share Trias’ development plans in technology, products and other directions to meet the emerging application needs of the securities industry?

Chen: Blockchain technology combines naturally with the financial field. It’s not just about the different cryptocurrencies you’ve heard about before. In fact, blockchain technology has inherent advantages in the securities industry.

For example, the cooperation between Trias and Soochow securities ensures operations of the most important part of of the system: the visual display. It also fundamentally improves the internal supervision of the industry and provides user-oriented query display.

We are also exploring other cooperation options with Soochow Securities. The main direction is to upgrade technology for the whole industry through a combination of technology and products.

The main consideration is security, and blockchain modules such as tamper-proofing, for example, digital storage of electronic contracts, blockchain commercial bills, and traceability control of supply chain finance. Another technology about which we released some information recently, Abe technology, which is also our way to solve the future problems of privacy protection and permission configuration during the process of data information upload and sharing on the blockchain. Stay tuned, and we’ll continue to release practical application updates.