The Great Custodian Bank Shake-up Part 1: Blockchain to Rewire Cust…


Abstract

Custodian banks are facing a slew of challenges such as cost pressures, operational inefficiencies, and aging legacy applications. Disruptive digital technologies such as blockchain and distributed ledger technologies (DLT), Robotic Process Automation (RPA),
and intelligent automation systems such as cognitive computing tools and decision support systems using machine learning (ML) algorithms can help custodian banks address these challenges. This paper, the first of a two-part series, examines how blockchain
or DLT can be applied to specific service areas to help custodian banks transform their operations.

Technology Driving Change

Custodian banks are under pressure to offer competitive and cost effective services to their alongside tackling multiple challenges including a stringent regulatory regime, legacy systems, rising costs, and inefficient processes. Enhancing operational effciencies,
minimizing run-the-bank (RTB) costs, and improving customer experience are therefore top priorities for these banks, which is where disruptive technologies come in. Custodian banks are looking at leveraging DLT, RPA, and intelligent automation systems such
as cognitive computing and decision support systems using machine learning to reengineer business processes and simplify and modernize their application architecture.

DLT in Action

Complex hierarchical transaction processing between market participants can be eliminated by leveraging blockchain or DLT to enable more comprehensive, peer-to-peer, disintermediated interactions resulting in faster and cheaper transaction processing. Financial
institutions must consider private blockchain platforms with permissioned ledgers such as IBM Hyperledger, R3 Corda, or private version of EthereumTM (Quorum ) to enable faster adoption of this technology. The key advantages of using these products are features
like disintermediation and immutability or data integrity, as well as their inbuilt smart contract capability that enables further automation. Let’s examine the key areas where blockchain can deliver maximum advantage.

Reference data management

Market data providers supply reference data to custodian organizations. Each individual firm obtains and manages its reference data and enhances it with additional data inferred based on financial data received from other sources such as issuers and stock
exchanges. This results in inconsistencies in the reference data used by different market entities, which in turn causes transaction breaks that require significant reconciliation effort at a later date.

Blockchain solutions have the capability to enable the sharing of uniform reference data across all market entities in near real-time. Market participants can come together to form a common platform underpinned by blockchain technologies, wherein issuers
publish the securities reference data for the use of all the members. Subsequent changes or enhancement to reference data by individual custodians can be approved by the issuers. This will help create a single, golden source of reference data across multiple
market participants.

Collateral management

Custodians offer triparty collateral management services to their customers. Based on the service agreements submitted by the two counterparties, service providers create a master contract in their repositories, which is considered as the golden copy by
all concerned parties. Amendments to this master contract and associated sub contracts, if any, are also processed by the triparty service provider. The entire process involves substantial manual intervention, which in turn causes significant operational risks.

Moving to a blockchain platform can help address these challenges. The triparty collateral manager can provide a blockchain solution for counterparties to create the master agreements and associated sub-contracts, which can then be validated by the service
provider. The immutability feature of blockchain technology ensures data integrity of the master agreement. Amendments to the master agreement requested by either of the counterparties will be verified, reviewed, and approved by the other counterparty as well
as the service provider. A new version of the master agreement will then be created in the blockchain ledger. A key benefit of using blockchain for creating triparty collateral agreements is that it incorporates all the non-repudiated amendments besides enabling
a single, consistent view of the agreements for all concerned parties.

Cross-border collateral movement between counterparties may involve the exchange of collateralized assets between parties’ custodian accounts resulting in expensive settlement processes. Blockchain technologies can be used to address this wherein a custodian
in a participant’s home market will accept the collateral and issue equivalent virtualized tokens to the participant on the blockchain platform. The number of positions in each security for each participant will be recorded in the form of virtualized tokens
in the blockchain ledger. Consequently, participants’ collateral across different locations and Central Securities Depositories (CSD) will reflect as tokenized balances in a virtual collateral pool. The parties that need to provide collateral to their counterparties
can initiate a collateral movement request in the blockchain ledger, which results in the settlement of virtual tokens, while the underlying collateral assets can be locked by a trusted entity. The return of collateral can also be initiated in the same way,
with the trusted entity unlocking the collateral securities. Such a blockchain based solution has the potential to greatly reduce the movement of physical securities across accounts and borders.

Asset Servicing

Custodians receive corporate action (CA) announcements from different sources. After announcement scrubbing, the custodian creates a golden copy of the announcement. Also, custodians typically enrich the announcement with additional data points based on
market data, inferences from historical data, and so on, which translates into a huge and expensive cumulative effort. Since the entire process is manual, it is error-prone, which means that inaccuracies in the information fed in by custodians can have huge
implications for the execution of the CA resulting in significant financial risk.

Proxy voting and voluntary actions are processed hierarchically by issuers, CSDs, custodians, brokers, and investors. Consolidating these responses manually at each stage is time consuming and error-prone. Blockchain solutions can be used to make the voting
process fast and efficient. The issuer can create the voting event on a blockchain platform and assign the eligible quantity to the custodians. Custodians in turn can assign the eligible quantity to the participants. The sum of the quantities assigned to participants
would equal the cumulative eligible quantity. Participants can further be enabled to vote on the blockchain platform which means that all the stakeholders can view the voting progress and the statistics on the blockchain platform in real time. Processing voluntary
actions and proxy voting on a blockchain platform can deliver multiple benefits – complete elimination of error-prone, manual consolidation efforts at multiple stages, reduced costs, and significant time saves.

Reconciliation

Reconciling positions between custodians, depositories, and other foreign sub-custodians entails huge manual effort, which can be eliminated by sharing position updates between custodians and depositories through a blockchain ledger sponsored by the depository.
The depository would update the position balances in the blockchain ledger and require custodians to review and acknowledge the updates. Such a solution will provide a real-time view of the position balances to custodians and depositories, while eliminating
the need for time-consuming and expensive manual reconciliation processes.

Looking Ahead

Custodian banks must leverage the wider ecosystem consisting of sell-side and buy-side firms, market infrastructure firms, as well as competitors, and tap into their capabilities and resources to build advanced blockchain platforms. By creating a common
platform that all the players can access, the total cost of ownership (TCO) will reduce drastically as individual firms will be saved the expense of managing standalone applications independently. This will help unlock exponential value for custodian banks
as well as other ecosystem players. However, care should be taken to choose only those use cases for blockchain adoption that have true transformation potential and the ability to deliver noteworthy productivity gains and returns on investment. Several leading
blockchain players are preparing to launch enterprise-grade blockchain platforms and custodian banks would do well to capitalize on the opportunity and adopt this disruptive technology to reimagine custodial operations.



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Report indicates growing importance of Blockchain – Med-Tech Innovation


Blockchain is set to gain more importance in the healthcare industry by playing a role in a wide range of processes, according to GlobalData.

The company’s latest report, ‘Blockchain in Healthcare’, states that the key factors affecting the implementation of blockchain include high upfront costs, outmoded legacy systems, scalability, heavy industry imposed regulations, and privacy concerns.

Blockchain technology can create ways for healthcare stakeholders – pharma companies, physicians, payers and patients – to collaborate, as well as facilitate information exchange. By using the technology, synchronised information can be securely stored enabling effective interoperability between healthcare organisations, while at the same time ensuring that each party is sharing the same real-world data.

Urte Jakimaviciute, senior director of healthcare market research, said: “One major issue that healthcare providers are facing is sharing information without violating privacy regulations such as HIPAA and GDPR. Since blockchain can be used as an interoperability layer, it can help to link the data between disparate systems creating a transparent and secure path for patient data sharing. Blockchain-based systems can also give patients more control over their personal data, as the technology allows them to track who has access to their data and when.

“Pharma supply chain management has a lot of issues deriving from lack of modernisation and a high number of intermediaries involved. Blockchain technology can potentially support the digitisation of supply chains, overcome the middleman problem and increase transparency and efficiency. 

“Companies, from manufacturers to retailers, can trace products through supply chains ensuring authenticity or flagging potential issues at any stage of the process. If a quality issue of the product is identified, blockchain can facilitate the recalls by determining the location of the faulty product within the supply chain.”

The ability to execute various transactions without a third party is regarded as the key benefit of blockchain technology. Organisations are able to manage their business without central authority involvement or control. However, this freedom comes with its own share of disadvantages such as integrity, limited storage and high development costs.

Jakimaviciute added: “Blockchain technology is not flawless as it comes with high implementation costs, slow transactional performance, limited storage capabilities and is unable to act as an analytics platform. Nevertheless, the technology is an important tool for establishing an efficient, transparent and customer-focused healthcare business model based on higher degrees of accuracy and trust due to the fact that it is a tamper-proof public ledger. 

“Whether hyped or not, blockchain offers higher security and transparency which is a top priority for the entire healthcare industry – from pharmaceutical companies to payers and hospitals.”

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Bank of Lithuania to issue blockchain-based digital collector coins


Bank of Lithuania to issue blockchain-based digital collector coins

The Bank of Lithuania, the country’s central bank, has announced its plans to issue blockchain-based digital collector coins.

The bank’s board has approved the sample of the physical version of the digital collector coin – an original silver coin bearing a denomination of €19.18, commemorating the year of the Act of Independence of Lithuania.

According to a press release, the silver coin weighs 36.36 g. Its size and form resembles a credit card, depicting the Act of 16 February 1918 as well as a digitised picture of the Council of Lithuania.

The central bank said that it intends to issue 24,000 blockchain-based digital collector tokens, called LBCOIN.

“LBCOIN is the world’s first blockchain-based digital collector coin created by the Bank of Lithuania. By implementing this unique idea, the central bank seeks to gain invaluable experience and knowledge in the field of virtual assets,” the Bank of Lithuania said.

Each digital token will feature one of the 20 signatories of the Act of Independence. Depending on their occupation, the tokens will be divided into six categories with 4,000 tokens allotted to each group.

When purchasing the digital coin, collectors will get six randomly selected digital tokens. Once a token from each of the six categories is collected, collectors would be able to redeem a physical silver coin.

The tokens will be available for purchase and storage in a dedicated wallet at the central bank’s e-shop. They could be used as a gift, exchanged with other collectors or transferred to a public NEM wallet. The digital collector coin is expected to be issued in spring 2020.



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Indian IT minister asks NIC for blockchain-based solution to improve public schools


Indian IT minister asks NIC for blockchain-based solution to improve public schools

Indian telecom minister Ravi Shankar Prasad has reached out to the National Informatics Centre (NIC) and requested them to improve the quality of public schools using blockchain technology, according to the Press Trust of India.

“I am very keen how we can leverage blockchain in primary education. In fact today I am going to give you a task, NIC team. Can you think of a good application of blockchain technology for improving the quality of government schools all over the country? Public schools are good, private schools are good but my take would be that we shall be able to leverage technology when transformational change takes place,” Prasad said.

Prasad made the statement during the inauguration of Centre of Excellence (CoE) in Blockchain Technology by NIC in Bengaluru.

The minister requested the NIC to also include startups in this initiative. He emphasized on the potential of blockchain technology in both private and public sectors and called for the technology’s implementation in agriculture, health, and primary education to name a few.

“India is home to close 26,000 startups, of which 9,000 are tech startups. NIC can become a big patron of the startup movement. I recommend that the Centre and state governments must open doors,” he added.

The NIC recognizes the importance of blockchain in the government. Its CoE has developed blockchain proof-of-concepts (PoC) for select government use cases. The NIC said that the CoE on blockchain will help government departments in developing PoCs for the use of technology in”different dimensions of governance” which will help drive the large-scale deployment of some such applications.

Meanwhile, the Indian Supreme Court decided to delay the hearing against the Reserve Bank of India (RBI) after the latter banned crypto banking in 2018. The court was flooded with appeals from the public asking it to reconsider the prohibition because they deemed it unconstitutional.

“The best part is that the court is willing to hear the matter, the court has not adjourned the matter, it has only passed over [it] I think it’s a very good sign, the court is willing to give both sides a fair chance to present their arguments,” said Kashif Raza, co-founder of Crypto Kanoon.

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Automated trade payments prove popular for we.trade blockchain


Blockchain trade finance firm we.trade recently told Ledger Insights that 55% of its transactions are automated payments. The firm is a joint venture between 12 major banks, including HSBC, Deutsche Bank, Santander, and Société Générale. Although it had a soft launch in 2018, banks started to roll out the service to clients last May, with the most recent CaixaBank launching its offering this month. 

Given the primary business model is to offer invoice financing and bank payment undertaking, one could interpret the popularity of auto settlement as unfavorable. But it may be a big win for suppliers, banks and we.trade.

The trade finance platform tracks the supply chain process. So provided the goods are delivered, payment can be triggered automatically on the contractually agreed date.

we.trade is available to companies of all sizes, and has proven particularly popular amongst small and medium-sized businesses (SMEs), the size of company that bears the brunt of late payment world-wide. A recent UK survey found that a third of the SMEs experiencing late payment have to wait two months beyond the due date. 

The European Late Payment Directive has had some impact, but not enough. Statistics for 2018 show only 42.8% of companies across the union respect payment terms, but that’s an improvement from 39% in 2016. There’s a wide variation between countries such as Poland (79.3%) and Portugal (14.2%).

Paying late is essentially using those suppliers as a source of finance. If the settlement is automatic and on-time, then the buyer might require more bank financing, a win for the banks. 

And for we.trade, automated settlement is a strong selling point to encourage adoption of the platform. So much so, that we.trade is considering offering the service to banks for free for domestic payments in the Czech Republic. It’s then up to the banks what they charge their customers. 

“If you look at a lot of tech companies, often they may have a freemium model and a premium model. We were looking at it in that context,” said Ciaran McGowan, we.trade General Manager.

Three of its member banks have a presence in the country, and together, they account for 80% of the market. They are Société Générale Czech affiliate Komerční Banka (KB), Erste Bank subsidiary Česká spořitelna and KBC subsidiary ČSOB.

Progress

Apart from the 55% of transactions being auto settlement, Bank Payment Undertaking accounts for roughly 27% of transactions and BPU financing 18%. 

Additionally, we.trade revealed a sector breakdown, including 46% of corporates are from the industrial/manufacturing sector, 40% in clothing and apparel, and 5% in foods. 

McGowan was quite upfront in saying he didn’t think they’d yet identified a sweet spot customer given the varied countries, company sizes and sectors. “I think the volumes need to get to a large enough scale before that will emerge,” he said. And he expects that to start happening later in the year after a set of new features have launched.

Ultimately we.trade is a software company. One of the typical KPIs is retention, and some one-off transactions would be expected. David McLoughlin, we.trade’s Head of Commercialisation acknowledged they have “what you might call frequent repeaters and occasional repeaters. And then the one-hit wonders.”

McGowan is particularly interested in feedback from one-off users, to find out how to turn them into regulars. Key demands are for an expansion of we.trade’s Trader Directory to Asia and ERP integration. For now, without that integration, companies need to upload their invoices to the platform.

we.trade’s roadmap

When it comes to the Trader Directory, customers don’t merely want to use the directory for finding partners. They also want to address negotiation discussions and agreement terms that tend to be spread over email, text and WhatsApp. The plan is to store these all in one place, a feature being developed internally at we.trade’s Dublin office. 

In addition to upgrading the Trader Directory to include Asia, expanding we.trade’s partnerships in Asia is another roadmap item. It’s been more than a year since we.trade announced a relationship with Hong Kong’s trade finance blockchain eTradeConnect. But that was an initial technical proof of concept. There are ongoing discussions about full relationships with Asian trade finance platforms.

To expand territories, apart from the business model and technology, it’s necessary to extend we.trade’s “Rulebook,” which covers governance, legal and compliance issues. For Europe, McGowan commented that the Rulebook took more time than the technology. That’s a message we’ve heard repeatedly for financial applications.

Also on the roadmap is the ERP integration as demanded by customers, and enhanced security required by banks. we.trade has done a roadshow to visit the compliance departments of all 12 banks. McGowan believes that satisfying all their requirements will “further drive we.trade’s commercialization by the banks.” He expects to deliver that in a couple of months and the four road map items by the start of the third quarter.

He’s also targeting July for an upgrade to a more recent version of Hyperledger Fabric to allow both on-premises hosting and a choice of clouds.

The hosting impacts we.trade’s bottom line because that’s its highest direct cost. The level of dedicated hosting is the biggest factor in determining the annual licenses to banks with platinum, gold and silver offerings ranging from €50,000 ($55,500) upwards.

Growing the team

The other key resources are money and people. On the finance side, at just over €15 million, the funds raised by the company are slightly less than some other incorporated consortia. Despite this and the shortage of blockchain skills, McGowan says they’re not struggling to attract talent to we.trade.

McGowan was hired in part for his technical background to help to build an internal tech team. When he joined in April last year, the team was eight, and so far, the headcount is up to 24, and he expects that to grow to 32-34 in the next two months or so.

Dublin is home to numerous global high-tech companies, and where competitor Marco Polo is also building a team. “We benefit from being in a city where there is an abundance of talent available – and we feel we are probably punching above our weight in attracting this top talent,” said McLoughlin.

The full list of banks is CaixaBank, Deutsche Bank, Erste Bank and its subsidiary Česká spořitelna, HSBC, KBC, Natixis, Nordea, Rabobank, Santander, Société Générale and its subsidiary KB, UBS, and UniCredit Italy. Eurobank, CSOB and UniCredit Germany are non-shareholder licensees.

Hyperledger, the umbrella organization of several blockchain protocols including Hyperledger Fabric, is hosting its annual forum in March in Phoenix featuring numerous industry luminaries. Register by 18 February for a discount. Ledger Insights is a media partner.




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Bitcoin’s ‘Twitter sentiment’ data gets rolled out by a blockchain data firm


New Zealand-based blockchain data and research firm Brave New Coin (BNC) has launched a new metric for bitcoin.

Dubbed “Twitter Sentiment,” the metric analyzes over 34 million bitcoin-related tweets every week, BNC announced Monday. The firm uses Artificial Intelligence (AI) algorithms that search for tweets containing words such as bitcoin, $BTC and BTC, among others.

BNC said sentiment continues to be a “significant” factor in the price and momentum of digital assets, and hence, it developed the metric. It took 18 months of work to launch bitcoin’s Twitter Sentiment data, said BNC, adding that the data is divided into seven categories – Opinion, Technical, Onchain, Adverts, Bots, Macro and Hack events.

For the week ending January 17, the Opinion category led the chart (constituting 30.42%), followed by Technical (technical analysis) and Onchain (mining, hashrate) tweets. All the categories are in green.

BNC spokesperson Pierre Ansaldi said the firm will roll out sentiment analysis for other cryptocurrencies as well during the first quarter of this year.

BNC provides various data and indices for the cryptocurrency market. Last year, the firm partnered with Nasdaq to add its bitcoin and ether indices to the stock exchange operator’s Global Data Service.



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Baidu Releases Beta Version of its Blockchain “Xuperchain”


  • Baidu Inc. announces its open source blockchain project, Xuperchain, in an official report released on Tuesday this week.
  • The blockchain will be available as a beta project, and users can pay 1 Chinese yuan (CNY), approx. 0.14 USD, to launch decentralized applications (dApps) on the platform.

An official announcement earlier on Tuesday from Baidu Inc., one of the world’s largest multinational technology and artificial intelligence companies, confirmed the launch of its beta test blockchain platform, Xuperchain. The blockchain is an open source engine that allows users to build dApps and run them on the platform “quickly”. The official website reads,

“Baidu Blockchain Engine provides users with a comprehensive cloud blockchain service platform, which can quickly build a blockchain network for companies and developers in public and private clouds, and fully support financial-level Fabric alliance chains, Quorum alliance chain, and private chain supporting multiple frameworks.”

The blockchain tested 350 TPS (transactions per second), significantly higher than both Bitcoin and Ethereum speeds, 7TPS and 15TPS respectively. However, the figure is still very low compared to the promise of carrying over 65,000 TPS on one chain and 200,000 TPS across the network.

Baidu Inc. launched its pilot project in May 2019 but developers faced a couple of challenges leading to the new update.

Blockchain in China is just taking off?

With one of the largest companies in China taking its space on the front row of blockchain implementation, the world should take note of the increasing presence of large legacy Chinese companies in the space. In 2018, Alibaba’s subsidiary, Ant Financial raised $14 billion USD to develop implementations of blockchains with the pilot project in line to be released this year.

According to a report featured on Coingape, the Chinese blockchain industry is expected to grow by 67% CAGR till 2025, showing huge institutional interest in the country. With top companies entering the market, and regulations fairly tilted to them, the decentralized ledger technology industry is set to experience a rush of development, investment and capital bumps.

Furthermore, the government is lenient on blockchain development in country despite banning initial coin offerings (ICOs) and crypto exchanges. The state sponsored a blockchain service network in Hangzhou, Zhejiang to make the government processes more efficient and friendly. Lest we forget the People’s Bank of China (PBoC) announced they will be launching a digital currency soon.

Watch out for China in 2020!

Summary

Article Name

Baidu Releases Beta Version of its Blockchain “Xuperchain”

Description

Baidu Inc. announces its open source blockchain project, Xuperchain, in an official report released on Tuesday this week.

Author

Lujan Odera

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Coingape

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Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.

Disclaimer
The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.



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Monerium to Issue E-Money on the Algorand Blockchain In New Partnership


Licensed e-money issuer Monerium will support the blockchain protocol Algorand in 2020. News of the two firms’ non-exclusive partnership was announced in a press release on Jan. 21. 

The cooperation will see Monerium issuing its programmable e-money on the proof-of-stake Alogrand protocol, created by the Massachusetts Institute of Technology (MIT) professor and Turing Prize award-winner Silvio Micali. 

Regulated e-money on the blockchain

Founded in 2016, ConsenSysbacked Monerium focuses on bridging fiat money and blockchains by issuing programmable digital cash, denominated in U.S. dollars, euros, British pounds and Icelandic krona. 

In June 2019, it became the first company worldwide to receive a license from Icelandic regulators as part of a new European regulatory framework for blockchain-powered e-money services across the European Economic Area.

According to the press release, Monerium’s e-money can be stored and transacted on the blockchain by retail users and businesses online without the need for banking institutions or payments providers. 

In a statement, Monerium co-founder and CEO Sveinn Valfells said that Monerium was prioritizing integration with blockchains that have “mainstream relevance”:

“Algorand incorporates key features for many mainstream use-cases, including stateless smart contracts and scaleable proof-of-stake consensus. The Algorand leadership has taken a pragmatic and deliberate approach in designing a blockchain for mainstream applications while staying close to the ethos of the open source community.” 

Algorand’s newly-updated protocol  

As reported, Algorand released an upgrade to its protocol in November 2019 to include more tools for enterprise-scale decentralized applications, or Dapps.

The upgrade also focused on developing new scalable blockchain-native solutions for real-world use cases, such as asset tokenization.

Algorand had released its public testnet to solicit feedback on the protocol in mid-April. The project had previously garnered $66 million in funding, releasing its testnet to a limited group of participants prior to the public rollout.

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Turkish City Developing Crypto and Blockchain Solutions for Public Services


Konya, the city of the world-famous poet Rumi, might not come to mind when talking about technology, especially blockchain and cryptocurrencies. As one of the major cultural centers of Turkey, Konya is known for its rich history, gorgeous mosques, and historical sites. 

But that has not stopped the Anatolian city from setting up its “Science and Technology Valley,” under the umbrella of Konya Science Center, and building a team to apply blockchain to municipal services. 

First revealed by Konya Metropolitan Mayor Uğur İbrahim Altay during a local smart city congress in Ankara on Jan. 16, this Turkish city is looking for ways to develop a “City Coin” and create a blockchain-based financial ecosystem around it.

Cointelegraph reached out to Dr. Ali Osman Çıbıkdiken, head of Konya Science and Technology Valley, about the progress on the so-called “City Coin” project. Çıbıkdiken, who also acts as an advisor to several blockchain projects such as TrueFeedBack, said that the first thing their team of seven blockchain developers did was “to look for ways to use blockchain technology for funding social programs.”

The project will enable the local government and other stakeholders to manage the reserve fund for social aid on the blockchain. The city aims to launch a prototype within six months and go live within a year. Konya hopes to be a global model for local governments with the City Coin project. Çıbıkdiken said:

“The cryptocurrency we are currently developing will be used in social aid programs, municipal corporations’ activities, public transport, and environmental services. This blockchain-based local ecosystem will serve the Konya citizens. The project will also see the development of a payment system to enable crypto in many municipal services.”

Blockchain solutions for a smart city

As a city with a population of over 2.4 million, Konya has enough people to test out blockchain in public services at a significant scale. On top of that, Konya has an edge when it comes to smart city applications. 

According to a detailed report from Konya Chamber of Commerce, the city has over 10 different smart city projects, from a payment system to use contactless credit cards in public transportation, to a smartphone app to cover e-municipality functions. 

They even have an app, called Mobile Mesnevi, to deliver the best poems from Rumi in different languages. The blockchain-based City Coin may be added in the future as a payment method for public services like shared bikes, smart transportation and electrical buses, among others.

Turkey at full throttle on blockchain

Following the announcement of a national blockchain infrastructure, Turkey has accelerated its blockchain efforts. The country set plans for a Digital Lira in 2020 and Turkish Takasbank launched the BiGa Digital Gold platform to provide a blockchain-based gold transfer system for the banking industry. 

BlockchainIST Center, a university-funded center in Istanbul, recently announced plans to develop next-gen blockchain projects on Cornell Professor Emin Gün Sirer’s Ava Platform, Cointelegraph reported.

The positive developments in Turkey are being noticed by global crypto exchanges, who set up local offices in the country. As Cointelegraph reported last year, Huobi was the first, followed by Binance. Recently, Huobi joined Blockchain Turkey Platform to cooperate with the local ecosystem on blockchain development efforts.

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Canada Forges $130,000 Development Deal for Steel-Tracking Blockchain


The Canadian government has awarded enterprise blockchain startup Mavennet a procurement contract for the development of an on-chain steel-tracking platform.

Innovation, Science and Economic Development Canada (ISED), a government agency with the mandate to foster technology innovation, published a procurement award on Nov. 12 that will fund the R&D project for six months with 169,427 CAD(about US$130,000).

The goal, as set out by ISED, is for Mavennet to build a blockchain proof-of-concept prototype that can track and share real-time data across the supply chain in the Canadian steel industry that regularly produces well over 10 million metric tons a year.

Mavennet’s CEO Patrick Mandic said in an interview that with a blockchain to trace live data points and AI to make those patterns meaningful, the system could have ripples across the multi-billion-dollar industry.

“Ultimately, you’re collecting a lot of data with new levels of granularity,” he said. “If you’re able to collect information in real time and in a way that you can trust, you’re opening up a world of possibilities for analysis and providing insights to the government,” Mandic said.

If phase 1 proves successful, Mavennet may unlock additional two-year government funding of up to $800,000 to continue building a deployment-grade system. It’s already pursing similar government contracts around the world, including an oil-tracking platform for the U.S. Department of Homeland Security.

“The adoption of new digital technology into Canadian industry will help ensure our firms strengthen their competitive advantage,” said Hans Parmar, a media relations manager for ISED.

Canada’s steel industry is a major international exporter, especially to the U.S. But that heavy reliance was rocked by President Trump’s 2018 steel tariffs and the ensuing market uncertainty. Last year, exports were down 22 percent.

Mandic said the tariffs provide a context for Canada’s search for a blockchain-based steel supply chain solution. Asserting that Trump’s decision was motivated in part by fears of tariff dodgers, who route their exports through untaxed markets, Mandic said blockchain’s immutability can verify claims of product origin. 

“What the blockchain provides is the ability to have a specific set of records in specific points of time,” he said. “You cannot go back in time and change the path.”

ISED’s Parmar refuted the idea that the project was launched in response to the section 232 steel tariffs. But in a statement to CoinDesk he also explained the platform could have blockchain-specific benefits. 

“The technology solution may facilitate trade and domestic policy adjustments, including aligning country of origin marking regimes, certification and labelling if implemented,” he said.

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The leader in blockchain news, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.



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