HSBC Executive – Transparency, Instantaneity Are Blockchain’s Main Strength
In an interview with tech journal L’Usine Digitale, HSBC executive has pointed that instantaneity and transparency are the primary strengths of blockchain technology.
The role of budding technologies, such as blockchain, artificial intelligence (AI) and Internet of Things (IoT) in trade finance was explained by Béatrice Collot, Head of Global Trade and Receivable Finance at global banking giant HSBC. The comments were made with reference to the forthcoming IN Banque conference in Paris.
Collot says that blockchain is on its path to drastically shift global trade finance by drawing together all stakeholders and permitting data to be exchanged in a transparent manner.
In particular, Collot said that blockchain has the capability to bring together both the financial ecosystem and the supply chain ecosystem. Financial ecosystem obviously involves banks and suppliers. Collot further explained that the technology can offer a unified platform for several stakeholders, thereby avoiding issues that slow down operations.
Regarding the advantages of blockchain, HSBC executive said
“Thus, transparency and instantaneity are the true strengths of the blockchain, and should generate not only significant time savings and increased security, but also significant [financial] savings.”
Collot, however, stressed that the advantages of blockchain technology should be only regarded as potential as of now, further adding “we are not quite there yet.” Collot further emphasized that the tech “must be widely adopted and interoperable” in order to achieve success.
Collot sees only three major blockchain platforms in use, namely R3 Corda of blockchain consortium, IBM-supported Hyperledger and Ethereum (ETH). Regarding blockchain platforms, the HSBC executive pointed out “[b]ut in reality, there are hundreds. Maybe in ten years, there will be only one.”
The executive also disclosed that the bank is regularly partaking in blockchain powered trade finance platforms such as We.trade and eTradeConnect and also the Corda-powered Voltron trade ventures.
The Voltron project, unveiled in October 2018, aims to deploy blockchain to handle letters of credit. The venture’s first real-time trade was trialed by Dutch International bank ING in November 2018.
Last month, HSBC announced that it had processed $250 billion in foreign exchange trades using blockchain in 2018.
HSBC’s blockchain platform, referred to as “FX Everywhere” has handled 3 million transactions and 150,000 payments since it was launched in February last year.