A partnership between ING Group, Société Générale Corporate and Investment Banking, and Mercuria Energy Group brought about the Easy Trading Connect Platform. This represents the first comprehensive and realistic use of blockchain technology for commodity trade finance.
Blockchain is the technology behind Bitcoin, the cryptocurrency and payment system that relies on direct transactions between users, without an intermediary.
The first prototype of the Easy Trading Connect platform was tested in a real trade involving an oil cargo shipment containing African crude that was resold 3 times on its way to China. The trade, which included traders, banks, as well as an agent and inspector, produced good results in terms of speed, cost and risk benefits.
Although wide adoption of the system is expected to take years, this prototype is a stepping stone towards improving efficiency in commodity finance.
The 3 partners believe that the focus should now be shifted towards building a coalition of banks, traders, insurers and inspection companies while focusing on the niche markets.
A more comprehensive report is at this link.