London-based bank HSBC, along with ING Bank NV, said it’s completed the world’s first trade finance transaction using blockchain technology. The move potentially opens the door for wider adoption of blockchain in the $9 trillion (€7.5tn) market for trade finance (Financial Times).
Using the Corda blockchain platform developed by the R3 technology consortium, HSBC and ING Bank processed a letter of credit for food and agricultural group Cargill Inc. The letter backed a shipment of soybeans transported last week from Argentina to Malaysia, said HSBC in a statement reported by Bloomberg.
Blockchain is the underlying distributed ledger technology that powers Bitcoin and other cryptocurrencies (see WikiTribune reporting).
You can edit or expand this story
You can edit or expand this storyEdit
Traditionally, the time required for exchanging documents in trade finances is five to 10 days. In the Cargill transaction, the exchange took only 24 hours.
According to HSBC, it was the first scalable live trade finance transaction using blockchain. “This is an inflection point for how trade is conducted,” Vivek Ramachandran, HSBC’s global head of innovation and growth for commercial banking, said in the statement.