National ‘firsts’ for Shanghai’s newly opened data exchange

SHINE | 03-Dec-2021 | By Zhu Shenshen

The Shanghai Data Exchange opened on Thursday with many nationwide “firsts” for its data trade ecosystem, smart transaction system and digital certificate. The new exchange is designed to improve data usage and management and connect “isolated data islands” to boost the city’s digital hub construction, while protecting privacy and ensuring strictly regulated data security.

Over 20 projects from eight sectors, including finance, public utility and transportation, completed their listings on the first trading day of the exchange. Located in the Pudong New Area, the exchange includes organizations servicing data transaction, data asset evaluation, data security and other sectors to build a complete industry ecosystem in Shanghai, said city officials and executives from the Ministry of Industry and Information Technology. Shanghai Mayor Gong Zheng unveiled the new government-authorized exchange as a key part of the city’s blueprint to become “a global digital hub.”

Mechanism and innovation

In future, more than 100 projects will debut at the exchange which will be attended by traders, technology providers and lawyers to ensure the data trade is reliable and efficient. The exchange mainly targets enterprise and organization users. All data usage and trade will be done under strict rules, such as “data to be used but not seen” to protect individual data security and personal privacy. It will solve challenges and problems for data flow and transactions relevant to “five difficulties,” covering rights confirmation, price evaluation, trust, entry and regulation and supervision, officials said.

On its first trading day, the Industrial and Commercial Bank of China and Shanghai Electric Power reached a deal involving data integration and usage between finance and energy industries. Banks will now be able to easily access data from public utilities and mobile carriers when deciding on loans to businesses, thus reducing their risk exposure. The official data exchange makes data sources “clear and reliable” by regulating the trade, said e-commerce firms that invest in data analysis to boost business.

Data security improved, privacy protected

Various methods are being taken to ensure data security and protect privacy. A data trade committee, consisting of 31 professionals in the areas of law, finance, data industry, data security, public management and economy, was also established on Thursday. It makes the trade “safe, regulated and efficient,” officials said. Data delivery and processing are being treated separately in the new exchange. The processing is handled by third-party tech firms, which will ensure data security, said Shanghai-based Transwarp, the exchange’s technology service provider. The traded data won’t involve sensitive and personal information, Shanghai Electric Power said.

Data security is getting growing attention nationwide as China is strengthening data and personal information protection and releasing new laws, such as the Personal Information Protection Law implemented earlier this month.