London — Swiss startup company Cerealia Thursday highlighted the boost to "data integrity" of the first trade of Black Sea wheat using blockchain technology to be negotiated and executed last week using its start-up trading platform.
The trade was for 3,000 mt of Russian 13.5% protein wheat on a CIF Marmara basis for spot shipment, between Switzerland-based Korel Trade Company selling to Turkey's Kavukcu Ulas.
The trade was negotiated and fully executed using blockchain technology on a the trading platform developed by Cerealia, based in Lausanne, Switzerland.
Blockchain is a mechanism that allows the chronological and public display of transactions that have taken place on the platform.
"The parties have been able to record all actions (from negotiations to concluding the contract and all execution steps and cargo docs) and sign them with advanced e-signatures on a public blockchain," Cerealia CEO Andrei Grigorov said Thursday.
The company used a state-of-the-art cryptographic hash algorithm to secure a single version of the cargo documents via blockchain, guaranteeing all parties to the trade -- including banks -- access to its documentation.
"Even if one letter or comma in the doc changes -- the algorithm generates automatically a completely different specific recording numbers, hash - thus permitting to ensure total data integrity," said Jaime Delgado, Cerealia's chief technical officer.
The technology allows deals to be negotiated efficiently, reducing the time and costs of execution, with a detailed history of all actions and documents exchanged and traders no longer having to wait for signed paper contracts.
"The Cerealia platform created a customized execution e-template for us, exactly as per our contract terms, with all of the main details and notifications in one place and always in front of our eyes, which basically enabled us to effect a much more streamlined trade execution than the usual old way," according to Celal Koc, a trader at Korel.
An independent auditor has reviewed and confirmed all of the steps related to the trade negotiations and execution.
Last year, Solaris and Transoil International carried out a blockchain trade of Black Sea wheat bilaterally, registering it subsequently on the Cerealia platform.
Platts assessed CIF Marmara 13.5% protein wheat at $217.50/mt Wednesday.
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