Latest news about Bitcoin and all cryptocurrencies. Your daily crypto news habit.
A blockchain trade finance platform developed by eight major banks, among them HSBC, BNP Paribas, and Citi, is now ready for commercial launch in Singapore in Q2 2020.
A blockchain trade finance platform developed by eight major banks, among them HSBC, BNP Paribas, and Citi, is now ready for commercial launch in Singapore in Q2 2020.Â
Named Contour, the launch follows a successful trial of the platform involving over $30 million in letter-of-credit transactions last year, South China Morning Post reported on March 5.
Letter-of-credit transactions are a payment mechanism widely used in international trade, in which a bank provides a seller with an economic guarantee for a buyerâs payment.
As the coronavirus continues to shake global markets, a regional executive told reporters that the platform can ensure commercial trades proceed smoothly even in times of crisis.Â
Ajay Sharma, HSBCâs regional head of global trade and receivables finance, claimed that:
âLeveraging blockchain for trade finance has overcome the physical constraints we are having today.â
He added that the company operating Contour expects to have a workforce of around 20 employees by the yearâs end.
An established use case for blockchain
Bank-backed blockchain trade finance platforms are already prevalent in Asia-Pacific and globally. In 2018, a platform dubbed eTrade Connect â backed by HSBC, BNP Paribas, Standard Chartered and nine other banks â launched in Hong Kong.
Trade finance platform we.trade â which also counts HSBC as a founder bank, alongside Rabobank, Santander, SociĂ©tĂ© GĂ©nĂ©rale, UniCredit, Deutsche Bank, and others â collaborated with the Hyperledger Fabric-powered IBM blockchain to complete its first live operations earlier that year.
In China this spring, a People's Bank of China-affiliated initiative run by the countryâs foreign exchange reserve regulator piloted its own cross-border trade finance blockchain in three major trading provinces.
Blockchain technology has been found to be beneficial across the trade financing process â allowing for the automated verification of customs documents and corresponding financing balances and enabling real-time and transparent data sharing.
In Oman, major oil and gas enterprises and HSBC Bank Oman SAOG conducted their first fully digitized letter of credit on the blockchain using R3âs Corda platform last fall.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.