Japan’s OSC launches online rubber trade using blockchain technology

Tokyo – Japan Securities Clearing Corp. (CCP), under Japan Exchange Group is implementing a blockchain technology in the settlement by delivery of natural rubber (NR) futures as of 31 Jan.

The technology, said CCP in an announcement 30 Jan, will be used for settlement by delivery of RSS3 futures as Osaka Exchange (OSC).

RSS3, according to CCP, is “the most standard natural rubber graded by international organisations or public authorities of the countries of production.”

This will be the first time the technology is being put to use by the Japan Stock Exchange.

Currently, a settlement by delivery of NR futures is performed through an exchange of a document called “delivery order”, which allows its holder to receive a delivery of rubber.

Going forward, the delivery method will migrate to an on-line exchange of a token recording the delivery order information using blockchain technology.

According to CCP, a total of 13 firms consisting of sellers, buyers and warehouses are involved in the project.

The online trade will make the delivery order shorter, as it will not require some preparation and delivery processes at each time of the settlement.

This, it said, will enhance the efficiency of the settlement by delivery.