World’s Largest Business Organization Embraces Blockchain

World’s Largest Business Organization Embraces Blockchain … the ICC Blockchain/DLT Alliance, a reference to distributed ledger technology similar …
International flags

The International Chamber of Commerce counts members from 130 countries among its ranks.Getty

From the embers of World War I emerged a new kind of organization, led by entrepreneurs, committed to ensuring the free flow of goods across the world’s war-ravaged borders.

The International Chamber of Commerce, whose mission is to streamline global business, is one of last vestiges of the League of Nations, founded in 1920 by U.S. President Woodrow Wilson to peacefully settle international disputes. By 1923, following the League’s lead, the ICC had established international courts to arbitrate business disputes, and in the aftermath of WW II, it represented global business interests at the Bretton Woods conference, which established the current monetary order.

“If goods are able to move across borders without the need to be accompanied by troops,” says John Denton, the ICC’s current secretary general, “there is a higher probability of peace and prosperity.” The Paris-based group, which represents 45 million businesses in more than 130 countries and brands itself the world’s largest business organization, is now making its boldest play in a generation.

With global borders hardening once again, this time behind border walls, broken unions and looming trade wars, Denton signed an agreement with the Singapore-based blockchain startup Perlin Net Group to explore how the technology, made popular by bitcoin for its ability to move value without banks, could help the ICC continue its mission to facilitate the free flow of goods.

“We can trace back the ICC interventions that made a big impact on the global economy in the 20th century,” says Denton, who was a fellow at the Australian Institute of International Affairs before being appointed secretary general of the ICC last year. “We think this might be one which we can look back on in 100 years and say the ICC shifted blockchain in a way that enabled the private sector to function more effectively in a sustainable way and actually create more opportunities for people.”

According to the terms of the agreement, part of which was shown to Forbes, the ICC and Perlin will create a new group, the ICC Blockchain/DLT Alliance, a reference to distributed ledger technology similar to the blockchain that powers bitcoin. The companies are exploring how Perlin’s blockchain platform, which has yet to publicly launch, could be used to shine a light on obscure supply chains and simplify cross-border trade finance.

As part of the agreement, the ICC will help Perlin recruit members to its nascent blockchain alliance, specifically by making introductions to the organization’s massive member pool, which in addition to most national chambers of commerce includes direct membership from companies like Amazon, Coca Cola, Fedex, McDonalds and PayPal. Also, as part of the agreement, Perlin will join the ICC as an official technology partner, offering free access to its blockchain platform during the early stages of the project.

Denton shared his plans with the ICC Banking Commission at its annual event in Beijing earlier this week, and the agreement, which was signed on March 20, will be formally announced at an ICC event in Singapore later today.

Unlike some early blockchain consortia, the ICC Blockchain/DLT Alliance already had projects under way when it was announced. According to the agreement, the ICC and Perlin will share the results of their first blockchain proof of concept, a collaboration with the fabric giant Asia Pacific Rayon (APR), in May at the Copenhagen Fashion Summit.

For that project, called “Follow Our Fibre,” APR is logging data in the blockchain at every level of its supply chain, from the trees that are harvested to the chemical treatments that turn them into the silk-like rayon substance through to the massive spools that are later sold to clothing producers.

“Globally, there is a dynamic shift in the textiles and fashion sectors calling for a more traceable and transparent supply chain,” says Cherie Tan, vice president of communications and sustainability at APR. “Follow Our Fibre will enable us to leverage powerful blockchain functionality to drive greater efficiencies.”

Other proofs of concept in the works that stand to benefit from the ICC partnership include a project with Mfused, a cannabis processor in Washington State that is using Perlin’s tech to prove the origin of its plants by recording every level of its supply chain, from when they are planted to when the cannabis is inhaled, in a shared, distributed ledger; a project with an unnamed tuna processor in Latin America; and a developing project in Africa to trace the origin of cobalt, which has a long history of being mined by unethical supply chain participants.

Assuming enough supply chains are unified on the Perlin blockchain, businesses could log digital representations of the commodities, called tokens, on the platform. This will enable the counterparties to trade directly, with bills of lading required to move freight and letters of credit, which are typically handled by banks, all tracked directly on the shared ledger.

“An interesting economic model is we could effectively launch governance around this,” says Denton. “If we’re able to tokenize this we could insert ourselves as the trusted intermediary, and there would probably be an admin charge, but not much.” A 2018 report by the ICC, the World Bank and others found that 90% of the world’s trade finance was being provided by 13 banks, something Denton thinks is evidence of a need to decentralize.

Perlin’s blockchain, like ethereum’s, is being designed to let users track and move all kinds of value and write distributed applications (dapps) that don’t rely on centralized processors. Also like ethereum, Perlin will have a native cryptocurrency, called perls, which are expected to be minted over the coming three months or so, depending on regulatory considerations.

While supply chain management is increasingly seen as ripe for disruption by blockchain, models like Perlin’s, which rely on tokens, have had difficulty gaining traction as regulators clamp down on what is required of such tokens. By contrast, models using permissioned blockchains, such as what IBM is doing with a number of industry-specific consortia, and what R3 and Hyperledger are doing more generally, are seeing broader interest.

Perlin founder Dorjee Sun positions the nascent ICC network as similar to competing consortia but for small and medium-size businesses. “This is a massive democratization effort of DLT, because now any company of the 45 million ICC members can give the benefits of DLT a try,” says Sun. “Not just massive companies that can afford IBM’s services.”

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IBM World Wire: What Does It Mean For Blockchain and Banking?

IBM World Wire, a global payment tool built on Stellar, went live in March. … First, one bank converts the money that it wants to send into a digital …
Blockchain Technology4 min, 32 sec READ

IBM World Wire, a global payment tool built on Stellar, went live in March. What will it accomplish, and will it be able to face the competition?

On March 18th, IBM and Stellar cooperated to launch a new blockchain-based payment service called World Wire, which will allow participating banks to perform international money transfers and settlements. This service will go head-to-head with competing services from major organizations like Ripple, SWIFT, and JP Morgan.

There is no way to say for sure which service will eventually come out on top. However, the realm of blockchain-based finance is growing rapidly, and IBM and Stellar are quickly establishing themselves as major players. World Wire could be IBM and Stellar’s big break—here’s why.

IBM World Wire handles money in a simple way. First, one bank converts the money that it wants to send into a digital asset—either IBM’s Stronghold stablecoin or Stellar’s XLM cryptocurrency. That digital asset is then transferred over a blockchain to another bank, which can convert the asset into its desired fiat currency.

This approach provides a few advantages. Because IBM World Wire is powered by the Stellar blockchain, it can perform transfers and settlements much more quickly and cheaply than traditional banking systems can. IBM claims that transfers on the network can be accomplished “in seconds” with “lower costs.” Additionally, Stellar stores transfer details on its ledger, which facilitates transparent record keeping.

Clients are already signing on for the service. IBM claims that 72 countries and 44 banking endpoints are currently participating. Additionally, Forbes reports that at least six international banks are planning to use World Wire to issue their own stablecoins—blockchain assets that are tied to the price of various fiat currencies around the world.

World Wire isn’t IBM’s first blockchain product. IBM is also partially responsible for developing Hyperledger, a leading blockchain solution for enterprise users. It is also a member of the Food Safety Alliance, a blockchain-based initiative that manages food supply chains and traces health issues. However, these projects manage various types of data, not just transactions.

This makes World Wire IBM’s most notable foray into blockchain-based finance. Jesse Lund, head of IBM Blockchain, suggests that Stellar will complement IBM’s other projects thanks to its ability to support new tokens and handle thousands of transactions per second. In other words, World Wire serves a much more finance-oriented purpose than IBM’s other blockchain efforts.

Maintaining a balance between business applications and financial applications could be very important for IBM. Although blockchain technology is very versatile, finance has always been blockchain’s most promising application ever since Bitcoin came into existence. Perhaps it is not surprising that IBM wants to make full use of that aspect of blockchain technology.

Stellar, meanwhile, will benefit from serving as the powerhouse behind IBM World Wire. Many other companies have already built services on top of Stellar, but IBM is undoubtedly the most significant company that Stellar has worked with. This means that World Wire could easily become more important than any other Stellar-based product.

This could benefit Stellar greatly: World Wire will generate activity for Stellar, which could raise Stellar’s profile and attract more developers to the platform. Increased demand could also drive up the market value of Stellar’s XLM token. Stellar is currently the eighth largest cryptocurrency, and World Wire could help it climb even higher.

It also seems that IBM’s partnership with Stellar will be a long-lasting one. IBM partnered with Stellar some time ago, and the two organizations have been working together ever since. In fact, IBM has been using Stellar to perform international payments since 2017. World Wire brings the technology to a wider audience and introduces more features.

World Wire will face considerable competition. Ripple’s xRapid is another blockchain-based settlement system, and it is World Wire’s most similar competitor. xRapid also preceded World Wire by half a year, so it has had something of a head start in terms of attracting clients. Additionally, Ripple’s XRP token is in the lead in terms of market cap.

Meanwhile, JP Morgan has announced that it is creating its own blockchain-based stablecoin, which will be used to perform international bank settlements. Although World Wire was never an option for JP Morgan, the fact that the financial giant is choosing to go with its in-house Quorum blockchain is a major blow for any competing platform.

Finally, SWIFT will pose a major challenge for World Wire. SWIFT isn’t a blockchain platform, but it is the dominant method by which banks carry out international transfers. Additionally, SWIFT has done sandbox trials of blockchain systems and, more recently, has started to use the R3 Corda blockchain. This means that another major blockchain-based financial service may be on the way.

IBM World Wire has the potential to become a successful platform and earn widespread acceptance in the world of traditional finance. Not only is World Wire a legitimately useful system, but it also has a few big names behind it. Of course, many of World Wire’s competitors can say the same thing.

Although IBM’s Jesse Lund has asserted that Stellar and World Wire have clear advantages over their rivals, the competition will be fierce. There is no easy way to compare the strength of World Wire’s various rivals, but one thing is clear: World Wire will face formidable competition in the coming years.

Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.

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INATBA Blockchain Association

“Developing a regulatory framework around distributed ledger and blockchain … It’s worth noting that INATBA is not the first blockchain initiative by the …

Other members who signed the official charter include Barclays, BBVA, Accenture and Anheuser-Busch. In addition to these established corporations, there were several blockchain firms participating such as IOTA, ConsenSys, R3, Ledger and Ripple.

Dominik Schiener, co-founder and co-chair of IOTA Foundation, spoke positively about this new initiative. He said:

“Developing a regulatory framework around distributed ledger and blockchain technologies is essential to their widespread adoption and growth. We have established our own Public Regulatory Affairs team to lead this effort and are excited to be one of the founding members of INATBA.”

To achieve its mission, INATBA will organize forums where industry startups, regulators and corporations can work together. This would enable the members to develop necessary blockchain regulatory guidelines and standards for bringing the technology into mainstream focus. Moreover, the association plans to create an inclusive and blockchain-friendly environment through regulatory frameworks. This demonstrates a central goal of transparency and integrity.

EU Blockchain Strategy

It’s worth noting that INATBA is not the first blockchain initiative by the European Commission. Early last year, it launched the European Blockchain Observatory and Forum to explore blockchain development in Europe. This was followed by the European Blockchain Partnership which saw EU member states sign a declaration to promote collaboration in the technology.

Lastly, the EU is also supporting blockchain technology with investment through its Horizon 2020 research and innovation initiative.

This latest development further reinforces the European Commission commitment to promoting blockchain adoption across various initiatives.

Tags: Blockchain TechnologyEuropean UnionINATBARay Battrick
Ray Battrick is a certified blockchain expert and FinTech copywriter who is devoted to working for you to build blockchain-based applications for your business. Ray is also a FinTech copywriter who is skilled at creating persuasive content for a wide range of products, including financial technology, business blockchain, investing and more. As an avid blockchain enthusiast, Ray enjoys writing about business blockchain, ICOs and cryptocurrency investment.

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