Zheshang Bank, one of the largest privately held commercial banks in China, has completed an issuance of securities worth $66 million using its proprietary blockchain platform.

Based on public documents, the bank filed a prospectus with the Shanghai Clearing House on Aug. 13 saying it would back the securities with a portfolio of account receivables from various corporations.

According to a report from China Securities Journal on Monday, the bank subsequently completed the issuance on Aug. 17, becoming one of the first institutions in the country to have made such an issuance over a blockchain network.

The blockchain platform, called Lianrong, was designed in-house by the bank to allow registered companies to broadcast account receivable assets to potential investors and to further let them settle invoice transactions as securities peer-to-peer.

By purchasing a firm’s account receivables, an investor essentially pays for the firm’s pending invoice at a discount and expects to later collect the full amount from the party liable for making the original payment.

Founded in 2004, Zheshang Bank is one of 12 publicly traded commercial banks in China that have launched various blockchain initiatives over the past 12–18 months.

Zheshang Bank is not the only financial institution turning to blockchain to specifically offer asset-backed securities.

JD Finance, a subsidiary of Chinese e-commerce giant JD.com, also announced a plan in June to launch a similar product via a distributed network in partnership with another commercial bank.

Zheshang Bank image via Wikipedia