(Reuters) - Many commodity groups, banks and technology companies are seeking to modernise the commodity sector and scrap millions of paper documents through using blockchain, the technology first developed for the crypto-currency bitcoin.
Below are details of what various firms are doing to roll out blockchain in the commodity sector.
MERCURIA - Completed a pilot oil trade earlier this year, working with bank ING and Societe Generale, in which a “smart contract” letter of credit was set up on a blockchain while the traditional paper process ran in parallel.
GUNVOR - Had several discussions with banking partners on the topic and “we’re prepared to cooperate going forward”, a spokesman said.
TRAFIGURA - Partnered with IBM and Natixis to put together a platform for U.S. crude oil deals, using IBM’s blockchain technology Hyperledger Fabric.
DREYFUS, CARGILL, OLAM - Members of a blockchain consortium working on a supply chain and trading system for the cotton industry using Hyperledger Fabric.
HSBC - Worked with Bank of America Merrill Lynch and the Infocomm Development Authority of Singapore last year on a proof of concept regarding replicating a letter of credit on a distributed ledger.
In January, HSBC joined with six other banks to work on a blockchain platform for trade among European small and medium-sized businesses.
BARCLAYS - In September, carried out what the bank billed as the world’s first trade transaction using blockchain along with Israel-based start-up company Wave.
CITIGROUP - Looking at how to use blockchain across all products and the bank has some investments in companies in the sector, but so far nothing unique to commodities was being pursued, executives said in February at a media roundtable.
ING, SOCIETE GENERALE - Worked with Mercuria on blockchain pilot (see above).
STANDARD CHARTERED - Completed a proof of concept along with DBS Bank and Infocomm Development Authority of Singapore using blockchain for trade finance invoicing.
COMMONWEALTH BANK OF AUSTRALIA, WELLS FARGO - In October, completed a blockchain transaction with Brighann Cotton involving a shipment from the United States to China.
ICICI BANK, EMIRATES NBD - The Indian and Middle Eastern banks executed trade finance transactions using technology from EdgeVerve Systems, a unit of Infosys.
BTL - The Canadian-listed firm launched a three-month blockchain pilot in March with European energy companies including Austria’s Wien Energie using its Interbit platform, focusing on the reconciliation process.
WAVE - Israeli start-up with blockchain technology to allow the shipping sector to move from paper to digital bills of lading.
GFT Technologies - The German software group launched a blockchain prototype for the physical commodities sector in January 2016. The firm in discussions with several commodity producers regarding its permissioned model, which uses Ethereum, an open-source blockchain platform.
R3 - A consortium of over 80 financial institutions and regulators, which developed the Corda distributed ledger on an open-source platform.
HYPERLEDGER - An open source blockchain collaboration hosted by the Linux Foundation, aiming to develop open protocols and standards.
Reporting by Eric Onstad; editing by David Stamp