Research Guide on Asset Subscription of Blockchain

Glossary

Term DefinitionBlockchain is a distributed database technology that is jointly recorded and maintained by multiple computing devices, with the characteristics of decentralization, openness, transparency, and data traceability. Smart Contract is an automatically executed contract deployed on the blockchain, triggered by transactions, and its logic is predefined by code. Asset Securitization is the process of converting illiquid underlying assets into securitized assets that can be traded and circulated in the financial market. Underlying Asset refers to assets that can generate future cash flows, such as loans, accounts receivable, etc., which are used as the value support of securitized assets. Securitized Asset refers to securities issued with the support of the future cash flows generated by the underlying assets, such as bonds, funds, etc. Asset Manager refers to the institution that manages securitized assets, responsible for the screening, subscription, issuance and management of the underlying assets. Original equity holder refers to the institution or individual that originally owns the underlying assets. Investment account refers to the account used by the asset manager to subscribe for the underlying assets, usually opened in a custodian bank. The underlying asset pool is a collection of multiple underlying assets, which serves as the value support for the issuance of securitized assets. The asset screening rules are formulated by the asset manager to screen the underlying assets that meet the conditions. The target transaction refers to the transaction initiated by the asset manager after the preset conditions are met, which is used to trigger the smart contract to execute the underlying asset subscription logic. Confirmation of ownership refers to the process of confirming the transfer of the ownership of the target underlying asset to the asset manager. Short answer questions

What is blockchain and what are its main features? (2-3 sentences)

What role does the smart contract play in the blockchain? How is it different from traditional contracts? (2-3 sentences)

Explain the concept of asset securitization and explain its basic process. (2-3 sentences)

In this patent, what is the role of the underlying asset pool? What is its relationship with securitized assets? (2-3 sentences)

How does the asset manager use the cash flow in the investment account to subscribe for underlying assets? (2-3 sentences)

What steps does the "underlying asset subscription logic" in the smart contract include? (2-3 sentences)

What role does the banking system play in the underlying asset subscription process? (2-3 sentences)

What is the "asset screening rule"? Who makes it and where is it stored? (2-3 sentences)

What role does "right confirmation" play in the process of underlying asset subscription? How to confirm the right? (2-3 sentences)

What problems does the technical solution proposed by this patent solve? What are its advantages? (2-3 sentences)

Answers to short-answer questions

Blockchain is a distributed database technology that allows multiple participants to jointly maintain a secure and transparent transaction record. The main features of blockchain include decentralization, immutability, openness, transparency and traceability.

Smart contracts are self-executing contracts stored on the blockchain, and their terms are written in the form of code. Unlike traditional contracts, the execution of smart contracts does not require the participation of third parties and can automatically execute pre-defined logic.

Asset securitization is the process of converting illiquid underlying assets into securitized assets that can be traded and circulated in the financial market. Its basic process includes: the original equity holder sells the underlying assets to a special purpose vehicle (SPV), the SPV packages them into an asset pool, and issues securitized assets based on this.

The underlying asset pool is a collection of multiple underlying assets, which serves as the value support for the issuance of securitized assets. The cash flow of the underlying asset pool is used to pay the principal and interest of the securitized assets.

When the cash flow in the investment account of the asset manager meets the preset conditions, the asset manager can send the target transaction to the blockchain, trigger the smart contract to execute the underlying asset subscription logic, and complete the fund freezing and equity transfer through the bank system.

The "underlying asset subscription logic" in the smart contract includes: screening the target underlying assets according to the asset screening rules, adding the target underlying assets to the underlying asset pool, freezing the corresponding funds in the asset manager's investment account, and updating the equity holder of the target underlying asset.

The banking system is responsible for maintaining the investment accounts of the original equity holder and the asset manager, and completes the fund freezing and transfer operations under the instructions of the smart contract to ensure the security and reliability of the transaction.

The "asset screening rules" are formulated by the asset manager to screen eligible underlying assets. It can be stored on the blockchain or on the asset manager's platform and called by the smart contract.

"Right confirmation" is used to confirm that the ownership of the target underlying asset has been transferred to the asset manager. In the smart contract, the right confirmation can be completed by the asset manager signing and confirming the right confirmation event.

The technical solution proposed by this patent solves the problems of inefficiency and lack of transparency in the traditional asset securitization process. Using blockchain and smart contract technology, the subscription of underlying assets can be automated, transparent and secure.

Essay question

Analyze in detail how blockchain technology is applied to asset securitization, and give examples to illustrate the advantages and challenges it brings.

What role does the smart contract play in this patent? What problems will be faced if smart contracts are not used?

Compared with the traditional asset subscription process, what are the innovations of the solution proposed in this patent?

Discuss the risks and challenges that this technical solution may encounter in practical applications, and propose corresponding solutions.

Predict the future development trend of blockchain technology in the field of asset securitization, and analyze its impact on the financial industry.