A Reality Check: Blockchain and DLT in International Trade

To help shed light on the intricate workings of the technology and the role that it is playing in the international trade industry, Trade Finance Global partnered up with the World Trade Organization earlier this month to produce a 56-page report titled "Blockchain & DLT in Trade: A Reality Check," endorsed by the International Chamber of Commerce.

The report begins by introducing a periodic table of DLT Projects - a design chosen to simultaneously represent striking similarities and distinct differences.

OpportunitiesThe report observed that 44% of respondents using or developing DLT listed increased speed and efficiency as a top-three benefit from utilizing the technology in the trade finance sector, while 35% indicated cost reductions.

While the sentiment of the outlook remains consistent between firms using and developing DLT and those that are not, the magnitude of this sentiment differs substantially.

"Blockchain & DLT have the potential to truly transform international trade, but technology is only a tool. As more and more projects move into production, putting in place the right policy environment becomes increasingly important. Governments have a key role to play in this respect."

Firms using or developing vs. firms not using or developing DLTIt is also interesting to note the difference in perceptions of the technology over time between firms using or developing DLT and firms not using or developing DLT. For each of the four time spans, firms not currently using or developing DLT have a significantly lower perception of the technology's widespread adoption in the future.

Magnitude of challengesAnother insight can be gained when looking at how the challenges facing DLT are perceived between the two two groups.

A massive 91% of respondents reported that DLT facing an interoperability challenge was reported by 91% of respondents, roughly 50% of which indicated that this poses a significant challenge.

65% of survey respondents using or developing DLT admitted that choosing between various DLTs is a challenge their organization has been facing and 86% indicated integration into back office systems as a challenge.

Deepesh regularly chairs and speaks at international industry events including at the World Trade Organization Public Forum, The Telegraph's Future of Trade and Export, BCR Consortia, TXF Geneva, Excred Commodities, as well as FCI and ITFA's Annual Conference.