The Financial Bank Wants to Advance in the Blockchain Race.
This article will analyze the view of the adviser, Noelle Acheson, who has helped corporate finance and investment fund managers for 10 years.
That is why, last week, the European banks, I NG and Société Générale released a Blockchain platform, designed to facilitate the Oil trading. When this news was made known to public opinion, it was not very popular due to lack of publicity. Therefore, it is considered that the news deserves a second opportunity that can be projected.
In this sense, to appreciate the information, this can be broken down into three factors.
First, it is said that this project is not just a proof of concept. The announcement reveals that a live transaction was conducted with the trading house of Commodities Trading house Mercuria. That is why, with a cargo containing crude “oil” from Africa, it was sold three times on its way to China. In this process acted active agents, such as merchants, banks, an agent and an inspector all became involved.
It is important to note that according to the participants, the result showed that a system driven by a Blockchain chain can significantly reduce the time needed to complete a transaction, as well as to improve document reliability, audibility and user experience.
Equally, secondly, the commodities industry needs a logistical overhaul. The central point is that it has changed very little in a long time, for decades it has been handled in the same way and still the process is done archaic it means that by hand with private documents, there is redundancy and errors abound, there is no automation of the processes.
On the other hand, letters of credit, bills of lading, shipping contracts, insurance, transportation and the respective payment for these services are just some of the components of a commodity commodity trade, which could Be automated by a digital platform.
In this sense, the transparency and immutability offered by blockchain technology could eliminate the risks associated with trust and ensure that each phase is seamlessly connected to the next.
Although, while the experiment was for an oil transaction, the steps involved in exchanging other products are not very different, which will allow the platform to scale easily.
Third, the nature of the oil trading sector puts it in a unique position to overtake the financial sector in blockchain implementation. First, it is dominated by very few active players who are major players. Some are important conglomerates, but others are less risk-averse independent firms than most financial institutions.
Therefore, the implication is that with one or two demonstrating positive results from mobile operations to one blockchain platform, the others will quickly follow the game in order to maintain competitive margins.
In addition, the need to remain competitive is likely to become more acute as the market begins a lower profit environment due to a flattening curve in the trading margins, this can be visualized when it is represented in the marketing charts.
Finally, the possible impact on the world economy of a more efficient oil trade could be even greater than that of a more efficient financial system, that is, the product as energy can have a greater role than money as a financial resource.
While it is pointless to debate the relative importance of money vs oil – both are essential in today’s economy – it is hard to deny that financial products are already easier to send across borders. Therefore, the benefits resulting from gains in speed and cost in the movement of oil are therefore likely to have an even greater short-term effect.
Therefore, a more efficient oil trading system would not only have a greater influence in smoothing the uneven distribution of such a necessary resource; it could also encourage blockchain experimentation and adoption all the way up and down the value chain of the products being marketed. New announcements are expected.
Disclaimer: InfoCoin is not affiliated with any of the companies mentioned in this article and is not responsible for their products and/or services. This press release is for informational purposes only. Information does not constitute an investment advice or an offer to invest.