Fifteen global banks, trading firms, and an inspection company launched on Wednesday a new venture under the brand komgo SA. The new entity, headquartered in Geneva, Switzerland, will develop a blockchain-based open platform to digitalize the trade and commodity market. The list of founders includes ABN AMRO, Citi, BNP Paribas, Crédit Agricole Group, Societe Generale, ING, Shell, Gunvor, Koch Supply & Trading, Macquarie, Mercuria, MUFG Bank, Natixis, Rabobank, and SGS. The venture plans to launch the platform by the end of this year.
Initially, komgo will be used for energy, with the first trade operations to be oil cargoes in the North Sea. Starting in 2019, the use of the platform will expand to agricultural products and metals. The venture plans to launch two products by the end of 2018. The first one will focus on KYC procedures. The parties want to avoid using a central ledger, as the exchange of documents will be conducted on the blockchain. The second product refers to digital letters of credit, which will enable commodity houses and other parties to present trade data to any komgo client bank.
The new venture will collaborate with VAKT, an energy trading firm managed by many of the listed shareholders in komgo. VAKT was founded in 2017 to build a commodity-oriented post-trade processing system based on blockchain. Other founders of the venture include British Petroleum (BP) and Statoil
komgo SA CEO Souleïma Baddi commented:
“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.”
Besides the collaboration with VAKT, komgo will build the platform in partnership with New York-based blockchain developer ConsenSys.
ConsenSys founder Joseph Lubin, who is also co-founder of Ethereum, stated:
“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.”