Banks Confirm Successful Cross-Border Trades Test on IBM Blockchain

blockchain cross-border trades banks cryptocurrency

A consortium of banks has confirmed the successful completion of cross-border trades on a blockchain developed in partnership with IBM, in a landmark development this week.

The We.Trade platform conducted its first cross-border transactions between participating banks and partner companies, with as many as 10 different companies and four different banks involved in the trials.

HSBC, one of the total of nine banks involved in the project, said three of its corporate clients took part in the tests, which were aiming to validate the IBM-powered technology in facilitating these transactions.

The model, which is expected to be ready for a commercial rollout as early as the end of the summer, could provide banks with a more efficient route to cross-border transactions, circumventing existing centralized payment and settlement systems.

With involvement from KBC, Santander, Deutsche Bank, Natixis, Rabobank, Societe Generale and UniCredit among others, the We.Trade platform is seen as a significant project for the banking sector, with the potential to reduce transaction costs and processing times.

Welcoming the announcement, IBM Europe’s blockchain lead Parm Sangha said the trials confirmed the power of blockchain in delivering for the financial sector.

“As We.Trade has moved from pilot applications to conducting live transactions across borders, it has demonstrated the power of blockchain technology in an enterprise setting.”

The We.Trade model was built with small to medium-sized businesses in mind, a factor Societe Generale said at the time would allow We.Trade to rapidly reach scale.

At the moment, We.Trade operates across 11 different jurisdictions in Europe, with plans to expand its reach into other markets in the near future, according to We.Trade chief operating officer Roberto Mancone.

This is likely to include other European countries, with Mancone expecting “buy-in from additional banks and their customers in Europe and further afield.”

Regarded as one of the key use cases for blockchain technology in practice, the financial services sector is investing heavily in blockchain research and development, developing proof-of-concept blockchain systems for a variety of commercial applications.

With cross-border payments on the blockchain now proven to be a possibility thanks to We.Trade, it looks like this is one area where more banks are set to benefit from the technology.