Perlin @ AMPLA Asia Branch Event with Rio Tinto: Blockchain & Commodities Trading
Doing away with the hype — is blockchain a game changer for commodities trading?
The Singapore Branch of the Australian Mining Petroleum Law Association (AMPLA) invited our CEO Dorjee Sun to speak on a panel in Singapore earlier this week discussing how blockchain will impact resources and trading. Moving beyond market hype, the Singapore AMPLA event focused on identifying the practical blockchain use-cases and value-adds for the vast global commodities markets.
Prominent panellists joining Dorjee included high-level reps from Rio Tinto (third largest mining company in the world by revenue), Ernst & Young (one of the ‘Big Four’ accounting firms) and Hopgood Ganim (major law firm covering resources and energy).
With experience at the leading edge of blockchain innovation, resources and energy trading, the panel explored how emerging distributed technologies like that pioneered by Perlin are likely to shape the future of global trade in commodities.
Much has been written about potential use-cases for distributed ledgers over the years, with varying degrees of connection to practical reality as opposed to fantastic speculation (and perhaps wishful thinking). An article authored late last year by Kyle Samani, MD of Multicoin Capital sets out a summary of the key unique strengths of distributed ledgers and which industries could most benefit in tangible and meaningful ways. One of the key relevant questions posed in that article was:
What markets are actually BETTER as decentralized P2P markets WITHOUT a centralized intermediary?
Relevantly, the AMPLA panel identified global commodities markets as a key opportunity for truly disruptive innovation using distributed ledger tech — the focus of discussion was not on whether distributed tech would change the commodities landscape, but when. The conversation centred around panelists’ views on the inevitability of distributed ledgers to transition from nascent technology to widely adopted industry standard. While widespread industry adoption clearly still has a way to go, AMPLA’s invitation for Perlin to join the conversation was a recognition of the ever-increasing role distributed ledger technology will play in all forms of cross-border commerce (commodities trading in particular).
Dorjee was invited to outline the clear advantages major resource and energy players like Rio Tinto would enjoy by employing our unique Wavelet distributed ledger for a significantly more efficient/transparent/secure framework for commodities trading. For example, Wavelet would greatly enhance processes for price discovery, trade execution, shipment tracking and logistics, asset ownership transfers, cross-border payments, elimination of fraud, and management reporting (among others).
Case in point, Rio Tinto talked through their recent landmark trade with Cargill for iron ore to China on blockchain. For this pioneering transaction worth USD $13M, Rio Tinto (via HSBC) and Cargill (via BNP Paribas) completed Singapore’s first fully digitized end-to-end letter of credit transaction between two different companies — reducing execution times from 6 days to 24 hours.
Dorjee also took the opportunity to cover how Perlin’s decentralized cloud computing platform could be used by major commodities companies looking to substantially reduce internal computational overheads (as well as create new revenue streams from the rental of idle internal compute power).
As always, the Perlin team is building innovative technology to address real-world use-cases with a consistent focus on practical product-market fit and mainstream user adoption.