Chinese corporate giant Ant Financial, led by billionaire venture capitalist Jack Ma, is introducing blockchain technology to the Alipay donation application. The added feature will utilize a distributed ledger platform to record collected donations.
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Ant Financial’s Alipay Goes Blockchain
Ant Financial Services Group is a subsidiary of the Chinese Alibaba Group, and as of April 2015, the company is valued at over $60 billion USD.
In 2015, Ant rebranded the Alipay platform, and has since been trying to improve its payment system for Alipay’s 400 million users.
By adding blockchain technology to the donation section, charitable organizations and donors will be able to verify and observe all funds being donated. Ant, being one of the most highly valued tech firms in the world, believes this will add more transparency to philanthropic payments.
Ant Financial Chief Technology Officer Cheng Li told Bloomberg:
We hope to bring more transparency to charity and blockchain technology’s decentralized nature fits that purpose well… It means that all the information and transaction history of funds will be more reliable and can’t be easily tampered with.
The type of blockchain used in the Alipay app has not yet been disclosed, but it seems to be a privatized implemented ledger. The first organization to use the app’s blockchain feature will be the China Social Assistance Foundation. Additional organizations will be added as the project progresses, says Ant.
Ma Haobo, the Beijing-based founder of the blockchain startup Hoopox, believes this technology is the right direction for Ant Financial, stating:
Ant Financial is smart to start experimenting with blockchain technology with something like charity, which is less sensitive and risky. If it’s really ambitious, the company should start looking at how to apply the technology in other financial areas.
Jack Ma Criticized for Not Donating to Chinese Victims
If Ant succeeds with its goals to make charity more transparent in China, it will create a better outlook towards philanthropic payment services. The country has had significant issues with transparency in regards to charitable giving.
In September of 2015, Ant Financial Group’s Jack Ma told a crowd at Peking University in Beijing, “The primary responsibility of entrepreneurs is making good investments to create jobs and wealth – blind donations will do no good.”
This comment follows criticism aimed at the Chinese billionaire for not donating money to victims in the Tianjin warehouse explosions in August of 2015, in which hundreds were killed. Chinese business leaders, government officials, and celebrities all pitched in to donate, but Jack Ma did not due to transparency.
Ant Financial’s steps towards a blockchain donation program will be scrutinized closely, with many Chinese investors watching. Bitbank’s Chandler Guo, a recognized investor and bitcoin miner, believes it is a good start for Ant.
“It’s great that Ant Financial is using blockchain technology to bring transparency to a murky industry that has operated like a blackbox,” Guo tells Bloomberg. “The key challenge is whether they have the right talent and execution strategy.”
What do you think about Ant Financial Group getting into blockchain technology? Let us know in the comments below.
Images courtesy of Reuters, Pixabay.