IBM trade blockchain completes first smart contract transactions
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
- Ethereum price breaks all time high of US$1,448
- Ethereum price: Massive slide as market faces bearish pressure
- Ethereum 2.0: Roadmap, timeline and implications
- Bitcoin falls to US$34,000 as confidence in money markets improves with the Biden inauguration
- Bitcoin price lags while regulators raise fears and banks grapple