Canada has been at the forefront of cryptocurrency development and regulation. This may largely be due in part to the prevalence of Ethereum network use in the country. Ethereum’s co-founder Vitalik Buterin was born in Russia, but was raised for most of his life in Canada. In August of this year, the Canadian government even released their own block explorer for tracking all transactions across the Ethereum network.
The government has also been actively working with electricity providers, citizens, and individuals or companies that want to mine cryptocurrencies to create a beneficial ecosystem for all parties involved. The country is attractive to miners because of their low energy rates, low temperatures and high percentage of renewable energy sources available. All of this has pushed blockchain further into the public awareness. Now one of the largest banks in Canada will be using the blockchain platform Skuchain to pilot a program for streamlining the process of standby letters of credit.
Continued Blockchain Development
The newest platform from National Bank of Canada brings more of a niche benefit. They have already been at work testing out more broad range use blockchain networks. In April, the bank was one of the first to use JPMorgan’s Quorum blockchain platform. In this instance, blockchain can be used to increase efficiency and transparency of the antiquated credit process. Currently they are negotiated with emails, which are prone to mistakes. Using smart contracts will reduce paperwork, errors and shed light on an otherwise closed-door process.
The platform, Trade360, uses Skuchain's Contract Builder. The integration allows National Bank of Canada to provide trade finance services to customers conducting business on a blockchain B2B solution in an entirely digital format with the structure of smart contracts. Customers will be able to initiate, conduct and conclude negotiations of standby letters of credit and guarantees with these contracts to intelligently design agreements and securely communicate changes. Further, as ideal formats are created, they will be able to use templates pre-approved by banks and negotiations on a distributed ledger for a wider customer base.
"This pilot project is a great opportunity to leverage blockchain technology to simplify the process for negotiating standby letters of credit and guarantees while making it more transparent and secure. This will enable us to offer a simple, fast and efficient experience to our commercial clients which facilitates managing their business" Patrice Roy, Vice President, Payments, Cash Management and International Solutions at National Bank of Canada.
By: BGN Editorial Staff