TRADEIX: BLOCKCHAIN-ENABLED TRADE FINANCE IN GLOBAL
SUPPLY CHAINS CASE STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
In February 2014, Global 3PL, one of the largest logistics companies in the world, announced an ambitious
expansion strategy. In accordance with that plan, the company struck an agreement in 2017 with Robert
Barnes, the chief executive officer of TradeIX Limited (TradeIX), to optimize its working capital
n
management. TradeIX is a start-up based in Dublin, Ireland that offers blockchain technology (BCT)
solutions to help companies manage trade finance more efficiently, especially in the area of accounts
tio
receivable. However, the potential for improvement in the realm of trade finance is heavily restricted by a
complex network of suppliers and an organizational structure of silos for data flow. Global 3PL is therefore
working on a pilot project with TradeIX, using its Marco Polo platform, to connect with insurance and
lu
banking services through a secure network. The process enables full transparency of all financing
transaction in the accounts receivable process. Despite the success of the pilot project, the efficiency of the
So
Marco Polo platform has to be assessed on a technological and strategic level. It is important to determine
The Case Solution Starts From page 6
, e
pl
m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. The core technology of the Marco Polo platform described in the case is based on blockchain.
Summarize in a few words what blockchain is and how it works. What is special about this new
technology?
2. The Marco Polo platform is based on a private and permissioned blockchain called R3 Corda. What are
its benefits and drawbacks? Are there blockchain variations that can overcome the drawbacks?
3. Along with the flow of materials and goods, the flow of information and finance demands optimization
within supply chain management. What were the key drivers that led Global 3PL to enhance its supply
chain through BCT?
4. Is the use of the BCT in trade finance justifiable, as discussed in the case? Does it present a long-term
sustainable solution? Use the framework provided in the case to support your argument.
The Case Solution Starts From page 6
,5. How would you describe the concept of tokenization in a blockchain context?
6. Blockchain can be used as an alternative medium for executing financial transactions and exchanging
documents. How else can the tokenization of trade finance information and assets be evaluated?
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 6
,ANALYSIS
1. The core technology of the Marco Polo platform described in the case is based on blockchain.
Summarize in a few words what blockchain is and how it works. What is special about this new
technology?
BCT is an emerging technology that has been a major talking point for the last few years. Its first and most
prominent application came from Satoshi Nakamoto, who published a white paper that introduced bitcoin
in 2008.1 Since then, many start-ups have revolved their business model around the deployment of a
blockchain, generating diverse headlines.2 For a business course, a more general, rather than specific,
definition is appropriate.
Essentially, blockchain creates an infrastructure that constitutes a shared and distributed peer-to-peer
database, which is cryptographically verified. It enables large heterogeneous groups of users to interact
without any central governance. This interaction takes place mainly in the form of transactions (i.e., entries
in the database) that log the transfer of a value container (i.e., token) from one participant of the network to
e
another. In contrast to a typical client-server architecture of a database, blockchain participants in the
pl
network do not act exclusively as either server or client.3
The technology has the potential to change business models and transform entire industries. However, there
m
is great uncertainty about BCT’s use cases.4 This often leads to overstating BCT benefits and ignoring the
Sa
n
tio
lu
So
The Case Solution Starts From page 6
, EXHIBIT TN-1: MAIN TRADE-OFFS IN THE BLOCKCHAIN (TRANSPARENCY VERSUS PRIVACY
AND SECURITY VERSUS SPEED)
Privacy Speed
Security Speed ↗
Transparency ↗ Transparency
Security ↘
Privacy ↘
e
pl
EXHIBIT TN-2: DIFFERENT TYPES OF BLOCKCHAINS DEPENDING ON THE RESTRICTION OF
m
RIGHTS TO READ AND WRITE
Sa
n
tio
lu
So
The Case Solution Starts From page 6
SUPPLY CHAINS CASE STUDY SOLUTION
e
pl
SYNOPSIS
m
Sa
In February 2014, Global 3PL, one of the largest logistics companies in the world, announced an ambitious
expansion strategy. In accordance with that plan, the company struck an agreement in 2017 with Robert
Barnes, the chief executive officer of TradeIX Limited (TradeIX), to optimize its working capital
n
management. TradeIX is a start-up based in Dublin, Ireland that offers blockchain technology (BCT)
solutions to help companies manage trade finance more efficiently, especially in the area of accounts
tio
receivable. However, the potential for improvement in the realm of trade finance is heavily restricted by a
complex network of suppliers and an organizational structure of silos for data flow. Global 3PL is therefore
working on a pilot project with TradeIX, using its Marco Polo platform, to connect with insurance and
lu
banking services through a secure network. The process enables full transparency of all financing
transaction in the accounts receivable process. Despite the success of the pilot project, the efficiency of the
So
Marco Polo platform has to be assessed on a technological and strategic level. It is important to determine
The Case Solution Starts From page 6
, e
pl
m
Sa
n
tio
lu
So
ASSIGNMENT QUESTIONS
1. The core technology of the Marco Polo platform described in the case is based on blockchain.
Summarize in a few words what blockchain is and how it works. What is special about this new
technology?
2. The Marco Polo platform is based on a private and permissioned blockchain called R3 Corda. What are
its benefits and drawbacks? Are there blockchain variations that can overcome the drawbacks?
3. Along with the flow of materials and goods, the flow of information and finance demands optimization
within supply chain management. What were the key drivers that led Global 3PL to enhance its supply
chain through BCT?
4. Is the use of the BCT in trade finance justifiable, as discussed in the case? Does it present a long-term
sustainable solution? Use the framework provided in the case to support your argument.
The Case Solution Starts From page 6
,5. How would you describe the concept of tokenization in a blockchain context?
6. Blockchain can be used as an alternative medium for executing financial transactions and exchanging
documents. How else can the tokenization of trade finance information and assets be evaluated?
e
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 6
,ANALYSIS
1. The core technology of the Marco Polo platform described in the case is based on blockchain.
Summarize in a few words what blockchain is and how it works. What is special about this new
technology?
BCT is an emerging technology that has been a major talking point for the last few years. Its first and most
prominent application came from Satoshi Nakamoto, who published a white paper that introduced bitcoin
in 2008.1 Since then, many start-ups have revolved their business model around the deployment of a
blockchain, generating diverse headlines.2 For a business course, a more general, rather than specific,
definition is appropriate.
Essentially, blockchain creates an infrastructure that constitutes a shared and distributed peer-to-peer
database, which is cryptographically verified. It enables large heterogeneous groups of users to interact
without any central governance. This interaction takes place mainly in the form of transactions (i.e., entries
in the database) that log the transfer of a value container (i.e., token) from one participant of the network to
e
another. In contrast to a typical client-server architecture of a database, blockchain participants in the
pl
network do not act exclusively as either server or client.3
The technology has the potential to change business models and transform entire industries. However, there
m
is great uncertainty about BCT’s use cases.4 This often leads to overstating BCT benefits and ignoring the
Sa
n
tio
lu
So
The Case Solution Starts From page 6
, EXHIBIT TN-1: MAIN TRADE-OFFS IN THE BLOCKCHAIN (TRANSPARENCY VERSUS PRIVACY
AND SECURITY VERSUS SPEED)
Privacy Speed
Security Speed ↗
Transparency ↗ Transparency
Security ↘
Privacy ↘
e
pl
EXHIBIT TN-2: DIFFERENT TYPES OF BLOCKCHAINS DEPENDING ON THE RESTRICTION OF
m
RIGHTS TO READ AND WRITE
Sa
n
tio
lu
So
The Case Solution Starts From page 6
