SGS, the Swiss testing, inspection and certification company, announced yesterday the launch of komgo SA, a new company grouping 15 shareholders in the commodities sector.
Komgo will launch a new commodities trade finance blockchain platform from the end of 2018.
The platform intends to reduce fraud, counterfeiting, and human error is what is currently a largely paper based process. SGS expects the platform to lead to efficiency gains as the time spent processing documents and data is reduced.
Partners in the venture include ABN Amro, BNP Paribas, Citibank, Crédit Agricole CIB, Gunvor, ING, Koch, Macquarie, Mercuria, MUFG Bank, Natixis, Rabobank, Shell, SGS and Societe Generale.
Comments
Fraud prevention in trade/commodity finance is an interesting niche use case for blockchain technology – I’ve heard of similar project from Monetago at a conference earlier this year.
For komgo, its good to see that this is not a ‘proof of concept’, but a move to a real live production platform, and that’s quite rare (they did 2 PoC’s before and liked what they learned).
The blockchain partners are credible – Consensys (Joe Lubin) has a lot of respect in the blockchain world, albeit it remains unclear whether the komgo platform will piggy back on the public Ethereum blockchain, or be a private network based on the Ethereum code (an important distinction due to the public Ethereum blockchain scaling and capacity limitations).
I suspect this does not move the needle for SGS. Their share of any financial benefit is probably quite small in the context of SGS’s CHF 7bn of annual revenues. However, they will benefit from the expertise gained and there may be other blockchain opportunities given their position in the TIC market.
My overall conclusion so far is that the blockchain projects making it to live production are ones just like this – quite niche, relatively simple, with limited numbers of participants. Those grand ambitions for blockchain/DLT to become all encompassing ‘world computers’ creating huge value for early adopters has yet to be proven.
What do you think?
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