Fifteen of the major institutions, including banks and trading companies, decided to work together to form a new venture known as Komgo with the main goal of digitalising the trade and commodities finance sector thanks to a blockchain-based platform.
This new Swiss company based in Geneva has been founded thanks to companies such as ABN AMRO, BNP Paribas, Citi, Crédit Agricole Group, Gunvor, ING, Koch Supply & Trading, Macquarie, Mercuria, MUFG Bank, Natixis, Rabobank, Shell, SGS and Societe Generale.
“The launch of Komgo SA highlights a shared vision for industry innovation and underlines the ongoing commitment among members to build a truly open and more efficient network within commodity trading,” explained Souleïma Baddi, Chief Executive Officer of Komgo, in a press release.
Also, in this group, there are two blockchain based Proofs of Concept (PoC) teams who previously tested the energy and soft commodities trading (Easy Trading Connect 12 and Easy Trading Connect 23) that have joined Komgo in order to develop a decentralised blockchain platform based on the Ethereum tech.
“The potential that distributed ledger technologies (DLT) have in transforming the commodities sector is clear as evidenced with the success of the Easy Trading Connect experiments,” said Toon Leijtens, CTO of komgo SA. “We can now achieve a long-term ambition to improve security and operational efficiency in the commodity trade finance sector.”.
The platform will be developed thanks to a partnership with ConsenSys, one of the most important companies that work on building applications, infrastructure, and solutions on the Ethereum blockchain.
Joseph Lubin, co-founder of Ethereum, and founder of ConsenSys said “We are now entering a new era of simple and inclusive access to blockchain technology to advance stronger, more collaborative, business relationships previously out of reach. We are thrilled to see leading commodity trade finance banks and commodity houses come together to create komgo SA, which will radically simplify and accelerate trustworthiness, auditability, and accessibility to trade financing across the industry.”
Komgo SA is a platform which is part of a global ecosystem aiming to optimise the whole flow of physical commodity operations.
Komgo SA will launch 2 different products, expected to be available before the end of the year: the first one will standardize and facilitate KYC procedures, so the exchange of documents will be executed in an encrypted way using blockchain technology; while the second product will be digital letters of credit, allowing commodity houses to submit digital trade data and documents to Komgo’s customer banks.