Last year, it was announced that a consortium of Rabobank, Concord Resources and PGS were looking to develop a blockchain trading platform for the metal repo financing business. The consortium had already started developing the system, at the time of announcement, with a goal to driving efficiencies, traceability and transparency in metals trading – starting in the repo financing business.
According to the initial news release, the initial scope was to digitally settle a metal repo transaction in which an aluminium position stored at PGS would be sold and re-purchased by Concord to and from Rabobank over the platform enabling all players to settle the transaction in a secure and transparent way at a fraction of the current settlement times, with the vast majority of the emails and paperwork that are part of a metals transaction to be automated and stored in the blockchain. This week, two other companies joined the consortium including Professional Services giant Aon and software vendor Gen10, who will build out the platform.
An area of potential application for Blockchain-type technologies has always been in the area of change of ownership like repo financing in commodities. Bringing together a number of parties like insurance broker, warehouse, bank and trader seems a logical way to develop and prove such a use case and prove its benefits.
According to the announcement today, Gen10 who have over the last twenty years, built many technology solutions across the whole commodities sector are building out the blockchain platform, leveraging their processes, technology and track record for rapid innovation. In fact, Gen10 CEO, Richard Williamson has been briefing us and the industry (via presentations) on the potential applications of blockchain for some time now telling us last November “If the future will be full of blockchains, people throughout the supply chain will need new business apps that can interface with them. And if it isn’t, all that effort won’t have been wasted.” Williamson said, “At the very least, the blockchain activity has highlighted the importance of standardizing data and processes in order to get to the next level – an area we have a lot of experience in. Our approach is that while waiting for the right blockchains to crystalize and return value, you can continue making progress with your digital transformation strategy with near-term tangible gains and plug these apps into the blockchain with our workflow engine, when your chosen blockchains are ready. Or just interface directly with your trade partners and service providers.“ That said, it seems collaborative blockchain solutions are arriving sooner than perhaps expected.
Gen10 has a 20-year history of innovation and in the last few years, has really innovated in many areas including blockchain developing a CTRM solution, migrating to and developing an ecosystem of apps and API’s that focus on collaboration in commodity supply chains, building traceability, marine insurance and laboratory platforms, trading games and other initiatives for its clients.
Certainly not your run of the mill CTRM vendor, Gen10 led by Williamson seems intent on shaking up the paradigm in commodity trading while focusing on making traditionally onerous and complex activities more streamlined, efficient and collaborative. With this latest announcement, it seems he is succeeding.