IBM to make “smart” contracts with Japanese banks based on blockchain

16 September 2016

A technology giant International Business Machines has come to an arrangement with Japanese Bank of Tokyo-Mitsubishi UFJ (BTMU) over their future transactions which will be processed on the platform of blockchain technologies with the use of “smart” contracts between the two companies. The partners will be implementing their project using open source blockchain within the Hyperledger Project.

The companies have created a model of smart contract management using the blockchain architecture for enhancing the performance and transparency of service level agreements. BTMU plans to implement the new service within its operations in the coming 2017 year.

The blockchain technology will be used for automating the process of issuing invoices and processing the payments between the two partners. According to an executive of the Japanese bank blockchain may go far beyond just changing the face of the financial sector, it may impact other business fields.

IBM in turn expressed its believe in the transparency of blockchain-based transactions as the parties to a deal have equal power and the security and management remain decentralized with a ledger being shared and constantly replicated in the environment.

During the year the technology developer has been advancing blockchain in several areas including healthcare and public services. Moreover, IBM announced its Center for Blockchain innovation in Asia, Singapore.

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