A €500,000 test transaction on a blockchain has been executed between German bank Commerzbank and steel manufacturer Thyssenkrupp, according to Cointelegraph auf Deutsch. The EUR/PLN forward deal was conducted on the Commerzbank’s FX Live Trader and then confirmed through Corda, which is a member of R3 blockchain consortium.
The introduction of blockchain streamlines the process of transactions, which proceed much quicker in fully automatic mode, without any mistakes happening. Commerzbank website states that the new technology will “significantly reduce operational risks in foreign exchange transactions”. Moreover, the banks don’t have to synchronize transaction anymore, as all the data is kept in a single, immutable record.
Nikolaus Giesbert, Head of Fixed Income at Commerzbank, explained the advantages of blockchain transactions:
“Significant resources are dedicated to resolving the issues that occur during the matching process. This deal demonstrates how the use of distributed ledger can transform and digitalise the processes in this space.”
Other banks are applying blockchain, too. Just a few months ago Spanish Bank BBVA issued a loan on a blockchain, which is something that global banks never practiced before. The bank claimed that utilizing blockchain has reduced the transfer time from “days to hours”. Banks from Thailand, Japan, and Singapore also reported running pilot blockchain transactions.