A group of global banks and heavy hitters from the trading and energy sectors are jointly launching the first blockchain-based platform for financing the trading of commodities from oil to wheat, they said in a joint statement on Wednesday.
The newly developed Swiss-based platform, which will be built on Ethereum’s blockchain will be called komgo SA and it is due to go live later this year.
Banks and major trading firms have been testing numerous pilot schemes across commodities over the last few years but this venture will be the first that any firm can join.
The komgo founders include ABN AMRO, BNP Paribas, Citi, Crédit Agricole Group, Gunvor, ING, Koch Supply & Trading, Macquarie, Mercuria, MUFG Bank, Natixis, Rabobank, Shell, SGS and Societe Generale.
The joint venture will digitalize trade and commodities, finance processes will be through a blockchain-based open platform that has been developed in partnership with the Ethereum-focused blockchain infrastructure and solutions group ConsenSys.
Co-founder of Ethereum and Founder of ConsenSys, Joseph Lubin commented on the development in the official announcement:
We are now entering a new era of simple and inclusive access to blockchain technology to advance stronger, more collaborative, business relationships previously out of reach. We are thrilled to see leading commodity trade finance banks and commodity houses come together to create komgo SA, which will radically simplify and accelerate trustworthiness, auditability, and accessibility to trade financing across the industry.
komgo will first be used for energy. The first trades will be crude cargoes in the North Sea, the benchmark-setting region for much of the world’s crude trading.
From early next year, komgo will widen to agriculture and metals.
However, the Komgo SA will work in partnership with Vakt, an energy trading platform used by a large majority of the shareholders in komgo.