The first two global transactions were carried out on Marco Polo, the alternate finance blockchain built on R3’s Corda platform. Announced Thursday, the trades were passed off among two German groups: Voith, a producer of machines such as generators, mills, and transmissions, and KSB SE, a provider of pumps and valves. One transaction concerned delivering the first hydraulic couplings from Germany to China, which was the opposite of shipping shoes within Germany.
While all of this could sound prosaic, those transactions have been splendid for the reason that vital records became exchanged via the dispensed ledger era (DLT), ditching the usual gradual and high-priced bodily documents and intermediaries, consistent with a press launch from the consortium in the back of the blockchain. The corporations agreed on the order and transport info through the Marco Polo community. After the goods were introduced, the cargo records entered the machine and “mechanically matched with previously agreed facts, triggering an irrevocable payment responsibility on the part of the purchaser’s bank,” the release said.
The amount of cash involved changed into not disclosed, nor did Marco Polo spell out which company turned into the client and which turned into the vendor. Banks on board Payments and financing had been handled via banks, also German: Commerzbank and Landesbank Baden-Württemberg, each founding participant of the Marco Polo consortium.
“The transaction proves that the blockchain era gives our customers a fee challenge and present-day financing for trade transactions with each overseas international locations and locally,” said Nikolaus Giesbert, a divisional board member for trade finance and cash management at Commerzbank, which has also tested DLT in capital markets.
Dr. Christian Ricken, a member of LBBW’s board of managing directors and head of its capital market business and asset management/worldwide enterprise, said DLT in trade finance “will make transactions faster, simpler, and more comfortable. We are breaking a new floor in terms of technology and cooperation between banks and companies.”
Next steps
Marco Polo stated the following step might be executing transactions directly connected to the client’s corporation’s useful resource-making plans (ERP) structures, even though it did not deliver a time frame for this. Founded in 2017 by R3 and every other blockchain tech company, Tradex, the Marco Polo community now lists 13 bank members on its internet site. Down the road, the consortium hopes to herald more banks, in addition to transportation and insurance agencies, “so that the entire cost chain for foreign change transactions is represented digitally with information,” Marco Polo stated.
However, Marco Polo is well behind rival community We. Trade already went stay last year (and has a baker’s dozen banks onboard). On the other hand, We. Trade has a narrower focus (small and mid-sized European establishments) and a nimbler company structure (now not a consortium) than member-managed, globally-minded Marco Polo.
