Blockchain applied to commodities: just a matter of time!
Commodities markets rarely feature in blockchain conversations, but if Memphis-based commodities brokerage The Seam and their technology partners at IBM and Hyperledger are successful, cotton will be the first commodity where an industry-wide consortium takes advantage of a blockchain to improve the trade process.
Starting on Thursday, The Seam website-based exchange is open to all industry players. The firm claims to be the first to offer “Agriculture’s only real-time price reporting.”
Along with the exchanges launch, the partners have called on the rest of the cotton industry to sign up as consortium members, placing their order books on the unified exchange. If they do, the industry would be able to use a single, shared blockchain to record, track, and trade all of the world’s cotton markets in real-time, and with instant trade execution.
(…) But this is just the starting point
While the banking industry has several consortiums like R3 CEV, The Seam’s consortium is among the first to address commodity markets. Kynetix, a commodities market technology company in the UK, was first to attempt a blockchain consortium in November 2015.
“The trouble is that everybody wants 2-way trust but not everybody wants 2-way transparency,” states Kynetix Co-founder and Director, Matt Dolton. “More than any other asset class opaqueness offers knowledgeable physical market participants the ability to take advantage of their knowledge.”
The argument can be made, however, that commodities are just more products to be tracked across a supply chain, which is already a well tested use for blockchains today. Startups like the diamond-tracking Everledger and the general-purpose, customer-oriented Provenance have shown that the technology can be applied to global-scale supply chains.
Several other projects track items such as luxury goods, smart clothing, prescription drugs, and most recently, 3D printed parts. With so many varied uses already employing blockchains, it may only be a matter of time before all commodities are tracked via a blockchain as well.
Read the full article : The Seam and IBM launch the first cotton industry blockchain consortium