A Chinese state firm has successfully invented a cutting-edge chip for data transmission in telecommunication.

Centec Networks under the China Electronics Corporation unveiled the fourth-generation GoldenGate switch silicon on Thursday, which boasts of high performance, reliability and energy efficiency.

As the first domestic chip of its kind, GoldenGate is expected to challenge U.S. semiconductor maker Broadcom's dominance in the Chinese telecom market, one of the largest in the world.

GoldenGate is available now with volume production scheduled for the third quarter of 2015.

A chip is the most important component of an electronic device. A major producer of mobile phones, computers and other digital gadgets in the world, China can't produce high-quality chips for many uses.

Last June, the Ministry of Industry and Information Technology released a guideline to encourage research on and production of home-grown integrated circuits. Domestic chip makers have reported some improvements or even breakthroughs.