Commodities trading house Trafigura and French bank Natixis are testing blockchain or distributed ledger technologies as an alternative settlement system to conventional letters of credit (L/Cs).

The trader and the bank are looking at blockchain in particular to settle deals in the US oil market.


Trafigura and Natixis have been simulating and testing the blockchain system in Texas since November last year.

According to New York-based head of global energy and commodities at Natixis, Arnaud Stevens, the system is designed to ease the L/C transaction process and streamline processes such as exchanging contracts and inspection by email or fax.

Blockchain progress

The simulations in Texas are the first of their kind in the US physical oil market, although Swiss trader Mercuria has used blockchain to sell African crude to China.

Barclays said it had completed the first live L/C transaction using blockchain or distributed ledger technology (DC World News, 23 September 2016).

Several banks and technology partners have announced progress applying blockchain technology in L/C and other trade finance operations (DC World News, 22 and 30 August; 2, 1 and 16 September; 3 October 2016).

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