Major Asian bank issues credit on SCB-backed blockchain
The Asian Development Bank (ADB), headquartered in the Philippines, has settled its first letter of credit (LC) transaction using the Standard Chartered-backed Contour blockchain network. The trade was a part of ADB's trade and supply chain program and involved Standard Chartered and the Bank for Investment and Development of Vietnam.
ADB's trade settlement also marked the first blockchain-based cross-border LC transaction between Vietnam and Thailand.
According to a Global Trade Review report, the trade involved a $50,000 plastics shipment sent from Thailand's SCG Plastics Co Ltd to Vietnam's Opec Plastics Joint Stock Company. Although ADB did not specifically mention how blockchain added to the efficiency of the trade settlement, Steven Beck, the bank's head of trade and supply chain finance, said that the use of blockchain has made trade more efficient while reducing risk and lowering the barriers to entry for small and mediumsized businesses in developing parts of Asia.
Social distancing measures implemented worldwide due to the ongoing pandemic has proven the importance of trade digitization, driving many major entities involved in international trade and supply chain to implement blockchain in a bid to digitize operations, set aside paperwork and resume business.
The London-based multinational banking firm Standard Chartered also conducted the first blockchain-based trade in Bangaladesh, introducing the South Asian country to blockchain innovation.
Cointelegraph previously reported that Australia's National Blockchain Lead Chloe White from the Department of Industry had suggested that blockchain could help combat food and wine fraud that costs the country almost $1.7 billion every year.
Asian stocks edged up Wednesday but investors trod a cautious path following a broadly positive start to the week, with focus on the outcome of the Federal Reserve's latest policy meeting. Markets have enjoyed something of a respite from the roller-coaster ride seen earlier in the month, which saw a rout of previously surging technology firms, as vaccine hopes and upbeat economic data offset worries about fresh virus spikes and new containment measures.
But eyes are now on the Fed. With US lawmakers unable to agree on a new stimulus package-despite the first running out last month, leaving millions of Americans struggling-the onus has fallen on the central bank to do much of the leg work in supporting the world's top economy. And while officials are not expected to unveil any fresh measures, having already indicated they will keep interest rates near zero for the foreseeable future, boss Jerome Powell's postmeeting comments will be pored over for an idea about the outlook and clues to future policy.
The bank "is likely to emphasise a decidedly low rate outlook for years to come to help nurse the world's biggest economy back to health after a record contraction", said Joe Manimbo of Western Union Business Solutions, referring to the second quarter's contraction of more than 30 percent.
But National Australia Bank's Tapas Strickland warned stocks could suffer a pullback if investors were disappointed by the outcome. "There is a risk the market is underwhelmed by the guidance provided by the Fed," he said in a commentary.
"There is some expectation that with the US Congress unwilling/unable to agree to a new fiscal package, monetary policy may need to step in to fill the void. Accordingly, markets will be focused on any changes to forward guidance and to any balance sheet adjustments." Sydney rallied 0.8 percent, while Tokyo, Hong Kong and Singapore were in positive territory after swinging through the morning. There were also gains in Wellington and Taipei though Shanghai, Manila and Jakarta were down.
There was little reaction to the World Trade Organization's decision to uphold a Chinese complaint over additional US tariffs on around $250 billion of imports, which was slammed by Washington.
US Democratic House Speaker Nancy Pelosi announced a new attempt to break weeks of deadlock with the White House and Republican-controlled Senate on passing a new stimulus package.