HSBC Issues First L/C Using Blockchain-Powered System

HSBC Issues First L/C Using Blockchain-Powered System
October 17, 2019

 

The cryptocurrency market has turned red after Bitcoin (BTC) failed to consolidate and rise above the $8,500 level. Bitcoin, at the time of writing this article, has dropped to $7,980. The market cap has declined to $148.78 billion. Along with Bitcoin, several major altcoins have lost significant ground. Ether (ETH) has lost 3% in the past 24 hours to trade at $174.11. Likewise, XRP has lost 2% to trade at $0.2833. Other major altcoins which have declined in the past 24 hours include EOS (EOS-$2.91, -2%), Bitcoin Cash ($216, -3.6%), Huobi (HT-$3.42, -3.8%), Cosmos (ATOM-$2.79, -3.9%), Binance Coin (BNB-$17.89, -2.4%), Litecoin (LTC-$52.35, -4.4%), Dash (DASH-$67.65, -4.5%), Tezos (XTZ-$0.8747, -3.2%), IOTA (IOTA-$0.2697, -3.8%), Ethereum Classic (ETC-$4.42, -4.1%), Tron (TRX-$0.0149, -5.3%), LEO (LEO- $0.9943, -0.3%), Cardano (ADA-$0.0382, -3.3%) and Stellar (XLM-$0.0618, -3.6%). Major altcoins which have appreciated in the past 24 hours include Monero (XMR-$56.81, 8.7%), OKB (OKB-$2.38, 0.5%) ChainLink (LINK-$2.34, 0.7%).

 

Government level initiatives

South Korea considering a digital trade foundation to reduce expenses

The South Korean government intends to set up a digital trade foundation to minimize trade expenses by utilizing blockchain technology. In this regard, South Korean Finance Minister Hong Nam-ki launched the country’s Development Plan for Digital Trade. As per the plan, disruptive technologies such as blockchain, AI, and big data will be employed to digitize the entire Korean trade finance ecosystem by the year 2021.

Finance Minister Hong Nam-ki explained the potential benefits of the digital trading platform intended to be built. “We will build a digital trading platform that can be easily and conveniently used in all stages of export, such as contracts, customs, set up, and logistics.”

The Korean government also set up a digital trade foundation with the intention to encourage e-commerce exports and minimize time and cost associated to trade finance by more than 90%.

Chung Seung-il, Vice Minister of Commerce and Industry, stated that these steps are aimed at making South Korea a leader in the international digital trade market and overhauling the Korean web-based export support base. He further said: “We will make trade more convenient by integrating and providing trade information and export support services of government and trade organizations.”

 

Private sector initiatives

HSBC successfully issues a letter of credit using blockchain

The multinational financial institution HSBC revealed the successful issue of a letter of credit using a blockchain-based system in Malaysia. The importer involved in the transaction is packaging firm Simply Packaging, which is buying resin from an unnamed Singaporean chemicals company. HSBC Malaysia and HSBC Singapore were the issuing and nominated banks.

HSBC underlined that this is the 11th transaction carried out using a blockchain-based system and the first such trial conducted by the Malaysian branch. HSBC CEO Stuart Milne highlighted HSBC’s commitment to employing innovative technologies.

Milne said, “I am very pleased that HSBC has pioneered Malaysia’s first pilot blockchain LC transaction. This showcases our strong commitment and ability to support cross-border trade by Malaysian businesses using cutting-edge technology platforms.”

 

Ernst & Young launches a blockchain platform for public money

Ernst & Young (EY), one of the “Big Four” auditing firms, has unveiled a blockchain platform for public money to improve transparency. The blockchain platform, dubbed OpsChain Public Finance Manager (PFM) system, facilitates transparent monitoring of public fund allocation such that the general public can view expenses.

PFM will also facilitate public funds allocated for a particular work to be compared with the final outcome. That would give a clear idea about the effectiveness of various policies.

The system can supposedly monitor public funds as they get transferred via several state government organizations. Notably, the ocean of data provided by the platform can be used to make better policy decisions in the future.

Regarding the impact of blockchain technology, EY said: “Blockchain technology can positively impact processes from tax collection to open data to public spending. […] Modern public financial management requires focusing on the things that matter most — transparency, accountability and robust evidence for decision-making — all factors that can be enhanced by blockchain technology.”

 

Aliant Payments to pay part of employee’s salaries in cryptocurrencies

The US-based merchant services provider and payment processing company Aliant Payments has decided to pay a portion of its eemployee’s salary in cryptocurrency. Aliant stated that the initiative is based on the wish that employees turn out to become invested customers in the move towards cryptocurrency. Two years before, Aliant unveiled CrptoBucks, a crypto processing system for vendors, created an exclusive, fully compliant system in July 2018 to handle crypto payments, swapping for the US dollar, and paying vendors the next day.

Aliant CEO Eric Brown explained how the adoption of cryptocurrency happens and the need for paying salary in cryptocurrency: “Adoption happens when you’re able to earn cryptocurrency, and then go on to spend it.” With a portion of salary in cryptocurrency, each employee of the Aliant team will have “a vested interest in cryptocurrency not just as something they work on in the office.”

Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.

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Andrew Wright

Prior to founding tradersasset.com in 2014, Andrew worked as a proprietary trader, then as a market maker. As a market maker, he traded options in over 100 stocks, he then began trading currency pairs in 2013. Andrew still actively trades both, and prides himself on educating and informing traders on the benefits of both Binary Options and Forex.


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