Will Blockchain Be the End of CTRM?

It’s difficult not to feel a sense of hype about blockchain – or more accurately distributed ledger technology. Everyday brings a bunch of new announcements regarding blockchain pilots, proof of concepts, and so on. Despite that, it has backers ranging from IBM, Mercuria, Shell, BP and many more. An announcement yesterday by a Maltese company called Tiqpit Solutions also attracted my interest and the white paper it has provided to my inquiry makes for highly interesting reading. The company has developed a prototype Commodity Trading system based on distributed ledger technology. It says ‘the final system, called tiqpit – platform, is designed for commodity trading based on distributed ledger technology and shall consist of a trading, reporting, finance, insurance and logistics modules providing the needed services for the commercial commodity industry in one single platform. The tiqpit – platform is the first independent commodity trading platform developed without the involvement of big corporations and provides the real revolution across the commodity trading sector. The platform provides an autonomous marketplace for all participants minimizing the need of intermediaries, creates an improved market place without barriers.’ Plainly, it is still talking about a future state but, the white paper makes a compelling case under which it would take significant market share funded in part by its own crypto currency issue.

At the moment, we have a survey running and although it is still early and we have not sorted or validated the responses, it is already quite clear that the majority of participants to date believe it will be CTRM vendors that are most disrupted by blockchain developments. I have my doubts about that and believe currently (I reserve the right to change my mind…), that it will be the brokers, private exchanges and physical trading venues that will be under threat from Blockchain initiatives. It also appears to have tremendous application in the supply chain side around key issues such as traceability and transfer of ownership. Yet, it remains early. For me, the CTRM solutions will likely remain the system of record from trade transactions for some time to come and although many vendors have been slow on the uptake with blockchain, todays video interview with US-based Enuit demonstrates quite clearly that the vendors hear the noise from the market. We all know of the hare and the tortoise story! Meanwhile, in interviewing four representatives from CTRM vendors for CTRMRadio recently about the top three disruptive technologies impacting CTRM, blockchain got more than its fair share of mentions.

We hope to be speaking with the folks at Tiqpit in the near future and will post what we learn. In the meantime, we’d like your opinions. To provide it, please visit our short survey and complete it. Furthermore, I’m looking for blockchain knowledgeable end users/consultants to talk with me for the next CTRMRadio podcast. If interested, please send me an email or comment on this blog.

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