IBM trade blockchain completes first smart contract transactions

Posted: 20 April 2018 1:13 pm
shutterstock world sun cryptocurrency 450x250

IBM is quickly becoming a centrepiece of the increasingly blockchain-driven future of global trade.

IBM's "Batavia" blockchain system was jointly developed by a consortium of the Bank of Montreal, CaixaBank, Commerzbank, Erste Group, IBM and UBS. It's an open trade platform built on the IBM hyperledger system to help automate international trade transactions and sharply reduce the costs of global trade.

It has now been successfully trialled across a range of geographies, transportation modes, trading parties and various sized parties, to highlight Batavia's flexibility across a range of transaction situations, BMO financial group has announced.

The initial transactions included the trading of cars from Germany to Spain, and textile raw materials for furniture production from Austria to Spain.

"We are proud to have played a significant role in achieving this milestone – successfully enabling international trade using Blockchain," said Jeffrey Shell, head of global trade & banking at BMO. "We are committed to continuing to develop innovative solutions that help our clients reach new markets; simply, safely and quickly."

The Batavia blockchain is now moving beyond minimum viable product, and entering a new phase focused on a production-ready solution. It's anticipated that this may include joining forces with fintechs, financial institutions or other innovation leaders in the market.

IBM is simultaneously working towards a global payment system based on the Stellar decentralised exchange, and IBM's Jesse Lund has previously said that the Stellar-based payment system might be recommended to clients alongside solutions such as Batavia, to better automate every aspect of a transaction.

Batavia has managed to cover the end-to-end process of a trade, including both the closing of trade agreements and the execution of smart payments, set to be automatically triggered by specified events in the supply chain and recorded in the blockchain. It's also able to integrate track and trace and risk management tools, to be connected to key events in the supply chains and signals from IoT devices, agreed upon between buyer and seller.

For example, automatic real-time warnings if a shipment leaves its planned route, which might suggest delays or other incidents, along with keeping a clear record of the incident itself.

"These and many other Batavia features help to establish the trade finance platform as a solid foundation for a future trade finance ecosystem," said the press release.

The logistics industry and blockchain technology have proven to be an exceptionally good match. Samsung recently estimated that it could save 20% on its international shipping costs by using a distributed ledger.

IBM, in particular, has proven to be a front-runner in the space with systems like Batavia, a partnership with global shipping giant Maersk and prototype hardware such as the super-cheap, near-microscopic blockchain computing chip.

Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VEN, XLM, BTC, NANO

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Latest cryptocurrency news

Picture: Shutterstock

Get into cryptocurrency

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Go to site