Blockchain technology in commodities
LinkedIn Twitter Facebook. Both banks presented the results of the Easy Trading Connect blockchain prototype after successfully using the new technology to carry out a live oil trade between parties with Mercuria, a global commodity trading group. The test proved that there were significant speed, cost and risk benefits to be achieved. The platform, called Easy Trading Connect, is designed for paperless trading and aims to digitalise and standardise commodity transactions in order to increase speed and efficiencies in the trade process. The prototype was used in a real trade to validate expectations. The experiment involved an oil cargo shipment containing African crude which was sold three times on its way to China, and included traders, banks as well as an agent and an inspector, all performing their role in the transaction directly on the platform.
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Blockchain technology in commodities
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- Maharashtra: Blockchain tech to get farmers faster finance
- Jurnal Online Informatika
- Blockchain technologies in the commodities industry
- A multitrillion-dollar industry is getting turned on its head
- Blockchain builds trust in agricultural commodity trade
- Blockchain Reduces Risk and Costs in Trading Commodities
- Industry 4.0: Blockchain, the
- Post-Trade Tech Firm Seeks to Build Commodities Blockchain Consortium
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Maharashtra: Blockchain tech to get farmers faster finance
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Economic literature: papers , articles , software , chapters , books. FRED data. My bibliography Save this paper. Blockchain technologies for commodity value chains: The solution for more sustainability? With the rising public awareness of poor social and environmental production conditions in many global value chains GVCs , the pressure for more transparency and traceability is growing.
Applications of distributed ledgers DL technologies such as blockchains are seen as a key solution in this context. These technologies enable the collection, recording and sharing of the information about physical transactions and related metadata in a tamperresistant way, without the control of a central actor. This briefing paper presents the basic concepts behind the DL and blockchain technologies and discusses the opportunities and limits of these applications in the context of GVCs.
The challenges are due more to power asymmetries in the value chains than to technical issues. Thus, most DL applications could only be tools to bring existing sustainable conditions in GVCs to the fore as long as chain governance and the lack of legal frameworks remain as the main obstacles to extending sustainability in GVCs. Handle: RePEc:zbw:oefseb as. Most related items These are the items that most often cite the same works as this one and are cited by the same works as this one.
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Jurnal Online Informatika
To the commodity traders that support it, blockchain technology is a panacea. Blockchain-based platforms promise to improve the way the commodity-trading industry operates by addressing its struggles: with inefficiencies and issues of trust and with the complexity of transactions, which typically involve multiple counterparties. But not so fast: Companies have already invested in different mechanisms to foster trust and address other obstacles. And blockchain could be bad news for certain participants, such as merchant traders, that rely on market inefficiencies to make money. Commodity trading needs improved standardization, efficiency, and tracking of goods. But whether blockchain is the killer app that will deliver these benefits remains to be seen.
Blockchain technologies in the commodities industry
In , a group of leading global agribusinesses came together with a goal of employing cutting-edge digital technology to modernise global agricultural shipping transactions for the benefit of the entire industry. Today, the Covantis initiative is proud to announce the launch of its revolutionary platform. Incorporated as an independent legal entity in Geneva, Switzerland, in March , Covantis partnered with market-leading technology providers like ConsenSys , its leading technical supplier, as well as Microsoft Azure Cloud and Cognizant , leveraging their solutions and services to deliver an innovative, best-in-class technology platform to transform global trade operations for agricultural commodities. In the coming months, Covantis will work to enlarge its network of participating companies and onboard the majority of industry players active in these flows. The company will continue to invest in building new capabilities that increase value for its clients from origin to destination, thus creating a global network for efficient execution of bulk commodities trade operations. Interested parties can learn more about the initiative by visiting www. Private Securities Litigation Reform Act of Forward-looking statements are not historical facts and involve inherent risks and uncertainties. Several factors could cause actual results to differ materially from those contained in any forward-looking statement, including in this case the risk that the platform may not be successful or fully achieve the objectives of the participants.
A multitrillion-dollar industry is getting turned on its head
More from this author English Department. Commodities trading has long been held up as one of the more promising sectors for blockchain technology. This is because the shipment of goods across the world requires constant monitoring by multiple parties and involves complex financing measures. Blockchain acts like an interactive database, controlled and updated by its members rather than a central authority.
Blockchain builds trust in agricultural commodity trade
While blockchain technology continues to be viewed as a key piece of future infrastructure across many industries, a new report has cautioned against it being viewed by traders as a silver bullet. According to the study, the volume of trade via blockchain has often been negligible to date, while a critical mass of use may be some way off. Having come to prominence as the technology underpinning Bitcoin, blockchain initially made its presence felt in the financial sector. It has since made waves in the freight and logistics industry, while clients in every sector from insurance to retail are pressing their consultants for advice on how to exploit, or defend themselves , from its disruptive impact. As a result, commodity firms and banks have been diving into blockchain pilot schemes over the last two years. A high-tech ledger system, blockchain uses a shared database that updates in real-time and can process and settle transactions in minutes without the need for third-party verification.
Blockchain Reduces Risk and Costs in Trading Commodities
We will discuss some of the companies that are cornering blockchain -based services in the commodities space. The primary assets that exogenous distributed ledgers track are commodities, also known as producer goods or raw goods. These goods touch each point of our everyday lives ranging from the coffee or tea we drink to the tables on which we set our cups. Such colossal amounts of commercial activity entail many different counterparties at each step of the process. These parties often have proprietary methods for ensuring quality, quantity, and other factors of their shipped or received commodities. These siloed assurance models entail inflated costs, long timetables, and sometimes unexpected delays for all parties involved, inflating the cost of doing business in commodity trading and trade financing.
Industry 4.0: Blockchain, the
The commodities sector is a particular challenge for the achievement of the sustainable development goals SDGs. Both large- and small-scale mining are assessed critically with regard to their social and ecological sustainability: The extraction of raw materials in regions with political conflict, child labour, tax avoidance and environmental pollution regularly have a high profile in global reporting. Following the media hype on blockchain technologies, particularly around Bitcoin as a virtual, decentralised currency, countless stakeholders from politics, business and science are endeavouring to identify meaningful applications for blockchain and make innovative recommendations on the use of this technology for the future.
Post-Trade Tech Firm Seeks to Build Commodities Blockchain Consortium
RELATED VIDEO: Commodity Corner - YT Edition - Adoption Of Blockchain TechnologyCommodities traders and banks on a new blockchain platform launched this autumn hold strong views on how the technology could soon transform their business. But the scheme is not without its challenges. Based in Geneva, komgo stands out for its focus on commodity trade finance; a niche sector dominated by an increasingly tight group of traders and banks, many of which are also in the Swiss city. Others agree that blockchain could be a game changer for commodity trading, which is still almost entirely done by paper. Unlimited access to Euromoney.
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From blockchain to cloud technologies, they are seen as having potential to transform commodities value chains, cutting costs, providing seamless automated tracking and execution of trades. While other sectors have fully embraced the power of technology, the commodity sector has been slow to the digital table. This is gradually changing though as firms have no choice but to look at the latest innovative tools, if they want to stay competitive, reduce costs and meet regulatory requirements. In general, the key areas of digitalization are no different from many other industries — Artificial Intelligence AI , Machine Learning ML and robotic process automation. Individually — and together — they can be applied across the trading value chain, ranging from pre-deal analytics i. Looking at the history of freight, the vast of bulk of commodities are still shipped mostly in the same manner they have for at least the last few hundred years — by railroads and sea.
The use of blockchain and cryptocurrency platforms continues to evolve and expand into new markets. It was developed as a joint venture amongst a group of oil majors, traders and banks. Rather, everything in between—deal recap, contract, logistics and invoicing—are handled through VAKT. The fact that no cryptocurrency is involved may ultimately assuage any issues with securities enforcement bodies.
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