Alibaba Seeks to Eliminate Middlemen in Blockchain Payments Patent

Chinese e-commerce giant Alibaba has been exploring the use of blockchain technology to speed up international payments, according to a new patent filing.

The patent application - "A System and Method That Adjusts Account Balance on a Blockchain" - was filed with the China State Intellectual Property Office in January of this year and was revealed on Friday.

Aimed to tackle the broad concept of adjusting account balances over a blockchain, the company explained how the system could be used to facilitate cross-border transactions that specifically involve a third-party payment vendor.

The document said that third-party payment services and their banking partners in different regions will all function as nodes to form the envisioned blockchain.

Subsequently each node will maintain a ledger of user balances, reflecting accounts in third-party payment vendors' mobile wallets.

When a transaction request is initiated, the nodes would verify the user's account balance, taking into account any legal compliance procedures that must be followed - a process enforced by triggering smart contracts encoded to the blockchain, the patent says.

Although Alibaba didn't explain how or if it intends to apply the system commercially, the document was published just days after the company's payment affiliate Ant Financial announced the launch of a blockchain-based remittance service.

Alibaba cross-border payments patent filing by CoinDesk on Scribd.

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