IBM announced Friday that it has signed a contract with the Bank of Tokyo-Mitsubishi UFJ (BTMU) to examine the design, management and execution of contracts among business partners using blockchain technologies.
Both companies will begin by piloting blockchain to automate business transactions between the two companies.
This is one of the first projects built on the Hyperledger Project fabric, an open-source blockchain platform, to use blockchain for real-life contract management on the IBM Cloud.
IBM and BTMU have built a prototype of smart contracts on a blockchain to improve the efficiency and accountability of service level agreements in multi-party business interactions. The bank plans to begin using it to manage contracts within their business in fiscal year 2017.
In addition, IBM and BTMU aim to manage agreements between the two companies with the system by the end of fiscal year 2017. To help improve efficiency, IBM and BTMU will monitor delivery and usage of equipment with a sensor that embeds information into the blockchain. This will then automate invoicing and payment processes between the two companies, according to IBM.
“Blockchain technology has the potential to change not only the financial world, but also other areas of the business world, leading to improved efficiency of the end-to-end business process,” said Mr. Motoi Mitsuishi, Deputy Chief Executive Officer of BTMU Asia & Oceania and General Manager, Singapore Branch and Corporate Banking Division for Asia & Oceania. “Today, we are embarking on a journey with IBM to exploit the potential of this new technology. We are very pleased with the outcome of the first blockchain proof of concept working with IBM Research and IBM Global Business Services and we look forward to seeing these blockchain applications come to fruition.”
“IBM continues to invest billions of dollars into research on emerging technologies that hold transformative potential for our clients. Blockchain will reinvent complex multi-party and contract-based business models, especially in banking and financial services,” said Bridget van Kralingen, senior vice president, IBM Industry Platforms. “This expands our expertise in helping clients identify the right projects and build out blockchain solutions to solve day-to-day business problems more effectively. We are delighted to be expanding the scope of our partnership with BTMU with this blockchain initiative.”
IBM announced the launch of the first global research-led IBM Center for Blockchain Innovation in Singapore in collaboration with the Singapore Economic Development Board and the Monetary Authority of Singapore. Located at the Watson Centre at the Marina Bay, the Centre aims to propel Singapore into a top destination for innovation in finance, trade, and commerce, and establish it as a global center of deep competence, expertise and industry leadership in enterprise blockchain and cognitive technologies.
IBM is rapidly expanding its blockchain consulting services and capabilities and actively working with clients to understand what it takes to make blockchain ready for business. Through its open source contributions to the Hyperledger Fabric and its blockchain services on IBM Bluemix, developers can easily and quickly develop applications while testing security, availability, and performance of a permissioned blockchain network.
IBM is advancing the science of blockchain, helping to remove complexity, and making it more accessible and open, the company said. Financial services, supply chains, IoT, risk management, digital rights management and healthcare are some of the areas that are poised for dramatic change using blockchain networks.