SBI works with UAE’s TradeFinex to set up joint crypto venture in Japan
SBI Holdings and TradeFinex will look to drive trade finance adoption of the Ethereum Virtual Machine-compatible enterprise blockchain XDC Network through a new joint venture in Japan.
United Arab Emirates-based firm TradeFinex operates its own decentralized platform on the XDC Network for trade finance originators to connect to a variety of banks and lending institutions. Aimed at enterprise use cases, TradeFinex primarily provides blockchain-based trade finance products, including invoicing, letters of credit, purchase order finance and supply chain finance.
The XDC Network is an EVM-compatible layer-1 network with interoperable smart contracts. Its documentation describes the protocol as a “highly optimized, bespoke fork” of Ethereum that uses a delegated proof-of-stake (DPoS) mechanism to achieve fast transaction times, low gas fees and high transaction per second capacity.
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XDC operates using its native XDC token, which serves as a reserve cryptocurrency for third-party decentralized applications (DApps) running on the network. The token is intended to be used for a variety of use cases, including DApp payment settlements, micropayments, transaction costs and smart contract deployment and settlement.
TradeFinex has been involved in collaborations with the World Trade Organization, the International Chamber of Commerce and various government agencies to explore blockchain as a means to overhaul the speed, transparency, costs and traceability of trade finance.
A 2020 report from the World Trade Organization highlighted TradeFinex as a network that operates “as both permissioned and permissionless: permissionless for public verification, but permissioned for selective data sharing.”
At the time of the publication, several participants were using TradeFinex, including Validus, Enigio, Ramco and the International Trade and Forfaiting Association, among others.
An announcement shared with Cointelegraph outlined the goal of the joint venture to localize XDC Network information and documentation in Japan, proliferate XDC tokens to local cryptocurrency exchanges and deploy trade finance solutions across the Asia-Pacific region.
The launch of the joint ventures comes after recent reports from Japan that its government intends to permit startups to raise funds through the issuance of cryptocurrency tokens instead of conventional stock listings.
Japan’s Financial Services Agency also announced its plans to amend its tax code related to cryptocurrencies in August 2023 to take a more active role in cryptocurrency regulation. This could include exemptions from paying “unrealized gains” tax on cryptocurrencies.
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