IBM, commodities trading house Trafigura, and the French investment bank Natixis are pioneering a blockchain solution for US crude oil transactions. Using a distributed ledger to host this market “allows major steps in a crude oil transaction to be digitized on the blockchain, ensuring improved transparency, enhanced security, and optimized efficiency,” according to IBM.
By having the buyer, seller and their respective banks all on the same ledger, all parties can simultaneously view and share data on the status of a transaction, from the time a new trade is confirmed and validated, to when the crude oil is inspected, to its final delivery and cancellation of the letter of credit.
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