A group of the world’s leading energy traders and banks is looking to shake up the centuries-old trade finance industry with the launch of two new platforms underpinned by blockchain technology.

Energy groups including Royal Dutch Shell, Mercuria and Gunvor, and financial institutions such as ING, Société Générale, Citigroup and ABN Amro are backing two new blockchain platforms.

By digitising the large amount of contracts, letters of credit, invoices and other paperwork currently sent around the world by email, fax or post, and putting them on the Ethereum blockchain platform, they are hoping that the new platforms will lead to faster, cheaper and more secure ways of completing a trade as well as settling the transaction.

“Blockchain technology will answer the needs of key participants in commodity trading by improving efficiency and security,” said Souleima Baddi, chief executive of Komgo, which will focus on commodity trade financing by digitising the lenders’ customer identification documents as well as electronic letters of credit. Financial Times

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