Business 27 April 2018

Erik Gibbs

Spanish bank completes landmark loan transaction on blockchain

The promulgation of blockchain in everyday life continues with another success story. The latest evidence of its importance to commerce comes from Spain after international banking institution BBVA transacted a loan entirely across the blockchain.

BBVA used a private blockchain to conduct the loan from start to finish, according to the Financial Times. In doing so, it has now become the first global bank to enlist the technology in a loan operation. The €75-million ($91.4 million) loan, from initial negotiations to the completion of signing, was managed on a distributed ledger. Both the bank and the loan recipient were constantly updated on the progress, and the transaction time was reduced from several days to just a few hours. BBVA called it a “significant advance in the exploitation of [distributed ledger] technology.”

With this transaction successfully under its belt, BBVA is planning to conduct more blockchain-transacted loans. BBVA CEO Carlos Torres Villa was quoted by the news outlet saying, “Blockchain can offer clear advantages for all sides in the corporate loan market in terms of efficiency, transparency, [and] security… It’s another strong example of how disruptive technology can be used to add value to financial services, something that is central to our strategy.”

BBVA had some help in managing the transaction. Spanish telecommunications company Indra assisted to make sure communications channels and equipment were always working properly. Borja Ochoa, Indra’s director of financial services, said, “This pilot served as an opportunity to take part in the first corporate loan operation based on blockchain technology in the world. The operation strengthens the position of BBVA and Indra as leaders in the practical application of blockchain technologies.”

The blockchain is the perfect solution for industrial and corporate loans, which are oftentimes more delicate and require more input from various sources and need to be kept more secure than personal loans. BBVA used a private blockchain for the transaction, but all loans will be registered and completed on the Ethereum blockchain. In addition to corporate loans, BBVA is exploring the possibility of using blockchains for international lending and trade, as well as in foreign exchange transactions.

BBVA is one of only a few global banks to proactively embrace cryptocurrency and blockchain technology. It has already made several investments into both sectors, and just a couple of months ago successfully completed trials for cross-border payments using Ripple.

Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.

Bitcoin Satoshi Vision (BSV) is today the only Bitcoin project that follows the original Satoshi Nakamoto whitepaper, and that follows the original Satoshi protocol and design. BSV is the only public blockchain that maintains the original vision for Bitcoin and will massively scale to become the world’s new money and enterprise blockchain.

COMMENT

latest news

QuadrigaCX payment provider threatens reporter over ‘highly defamatory’ piece

Business 4 hours ago

QuadrigaCX payment provider threatens reporter over ‘highly defamatory’ piece

As one reporter digs even deeper into the mysteries of QuadrigaCX, one payment provider didn’t appreciate the closer look and threatened legal action.

Read More
Duke University, Citizens Reserve partner for new incubation lab

Business 6 hours ago

Duke University, Citizens Reserve partner for new incubation lab

Duke University has partnered up with Citizens Reserve to help students get knowledge and build interest in blockchain technology.

Read More
Indian police arrest 4 in $14M crypto scam

Business 6 hours ago

Indian police arrest 4 in $14M crypto scam

The Indian police have arrested four suspects in India’s biggest cryptocurrency scam to date.

Read More