What is block chain in trade finance

[Shiva90]

Hi Experts,

Any one explain please. I am new to this site happy to see you all in the site.

Thanks in advance!!!

[leslietomb95]

I am also a newbie want some help with the trade and finance terms.

[shahriar]

To understand block chain in trade finance, you need to understand what is block chain and how it works. Do you need help on that?

[Sari16]

I will try to explain it in the simplest way possible.

Let’s imagine you are a singer. You finished recording a song and posted it online or sent it to a friend. Basically what you did was creating duplicates of the same file. One held by you, the other by your friend and another million more by your fans.

This is what happened, when you share something online or sent it to a friend.

This is perfect and it is how internet works best, because the files/informations you shared, you will still have it, and the files you downloaded legally/illegally will still be available for others to take benefit of it.

However when it comes to money related, its not good. Imagine you sent $10 to a friend, immediately he receives the $10 and at the same time you are still having the same $10. He then sends your $10 to another friend of his and so on and so forth. This lead to devaluation of that $10

This is how blockchain will regulate and fix this problem. Blockchain is a cryptocurrency, in which the $10 can only be used once and not be duplicated ( it means that once you sent $10 to a friend, you will not be having that same $10, and your friend can then send it to his friend, and his friend to his his friends and so on).

Isn`t it like Paypal or some Shanghai based FinTech company that went public 2 days ago?

It may look like it, but its not exactly like it. In Blockchain, there will be no regulator.

[aymgoa]

Glad to know that, thank you.

[MarielDam965]

I wanted to share with you this information:
Blockchain-enabled trade networks can benefit all stakeholders by reducing friction from the logistical and operational inefficiencies across the trade finance value chain. In the short term, blockchain would be instrumental in optimizing business processes by reducing redundancies and implementation inefficiencies. It is important that traders or trading results analysts master the concept of the block chain in trade finance.

[Emil123]

I've heard about this in an ICC training last year. But as far as I know in my country it has not been implemented.