As a cutting-edge technology, block Chain technology has broad application prospects in various fields. In the era of digitalization, intelligence and networking, the use of block chain features to solve the difficulties of identification, letter of credit fraud, document forgery and other typical risks in international trade, as well as the many difficulties in some countries such as weak information infrastructure, low efficiency of information exchange and large differences in legal systems, will help to improve the efficiency and order of trade and reduce the cost of trade information exchange.
Blockchain technology
In essence, a block chain is a decentralized, untrusted distributed database that is maintained collectively and formed through cryptography. Its birth is the result of multiple advances in cryptography, mathematics, algorithms and economic models. Understanding block chain technology should be understood by two parts: Transaction and block.
In the traditional form of electronic transactions, both parties to the transaction provide credit guarantee, data processing, data recording and other functions through an intermediate third party (such as a bank or other financial institution). In this model system, the center (financial institution) is the core of the whole system. When there is a problem at the center of this model, the trading system will face extremely high risks because the center carries all the key functions and credit. Block chain transactions are trust-free, center-free, peer-to-peer. In this model, when a transaction occurs between nodes, the books of all nodes will write the transaction information through the Block chain network. For example, when a transaction occurs between node i and node j, the transaction history will exist in the books of all nodes, and an irreversible data record will be formed through a hash check mechanism between blocks. Because this system is decentralized, the damage or untrustworthy of one node cannot affect the operation of the whole system.
Block
The concept of block is an important part of the underlying technology of block chain. A block chain is a series of interrelated data blocks composed by cryptography. Each data block contains the hash value of the previous block, and the integrity and validity of the data in the block chain are guaranteed by mutual verification. Therefore, the data storage of block chain is irreversible.
Current Problems in International Trade and Financial Information Exchange
At present, the transfer of remittance, voucher and bill information between banks is mainly through SWIFT. Its nodes communicate with each other through international dedicated lines and exchanges. Since its establishment in 1973, SWIFT has connected more than 11,000 banking and securities institutions’ market infrastructure and corporate customers in 200 countries and regions.
SWIFT system is claimed to be safe, reliable, fast, standardized and automatic. However, many cases prove that the security, economy and processing efficiency of SWIFT system are facing the increasing data volume and various complex and changeable network security environment and hacker attacks. In the future, it will be very difficult to meet the demand for information exchange in international economy and trade. In particular, in February 2016, an account opened by the central bank of Bangladesh with the Federal Reserve Bank of the United States was hacked undetected. The attacker obtained the operation authority of the SWFIT system by modifying the data validity verification instruction of SWIFT’s Alliance Access client software, resulting in the theft of US$ 101 million from the central bank of Bangladesh. At the same time, the transferred SWFIT message was also deleted to cover up the traces of illegal transfer. The incident directly exposed the existence of serious security problems in SWIFT’s systems.
At the same time, SWFIT system also has other shortcomings, such as higher telecommunication fees, slow transaction speed, insufficient redundant disaster preparedness measures, imperfect identification means, etc. These problems directly affect the cost, security and transaction efficiency of international trade settlement, and become one of the factors hindering the development of the world economy.
On the other hand, with the deepening of the background of trade conflicts in various countries, various countries should also establish and improve cross-border financial settlement mechanisms to avoid the problem of lacking a core system for cross-border payment settlement and relying too heavily on SWIFT.
Leveraging Block Chains and Smart Contracts Technology to Improve Existing Trade Processes
In the traditional trade process, there are many steps from the establishment of a Contract to the importer’s taking delivery of the goods, and the operation is complicated. Relevant institutions need to carry out a large amount of data exchange. These tasks must be performed on bank working days, accompanied by a large number of manual audits and paper documents, resulting in a decrease in efficiency and safety. At the same time, there are risks such as letter of credit fraud and soft terms of the letter of credit, resulting in a gradual decline in the use of letters of credit.
Smart contract is a computer protocol designed to disseminate, validate, or execute contracts in an information-based manner. Smart contract allow trusted transactions without third parties. These transactions are traceable and irreversible. Through the smart contract technology, the traditional bank’s credit intermediation function is transferred to the smart contract for execution. Through the verification function of the Smart contract and the computer program, the condition judgment of the trade contract is performed quickly, and the next step response according to the trade process is made.
For example, in a typical smart contract trade process, a commercial sales contract based on the smart contract is established between the importer and the exporter in the block chain network, the importer provides a security deposit to the financial institution, which records the payment of the security deposit to the block chain network in real time, after the security deposit is paid, the exporter ships the goods, and the transporter uploads the loaded goods to the block chain network. A payment instruction is issued to the financial institution when the payment terms of the transportation document and the commercial sales contract in the smart contract are met, and the financial institution can make payment settlement to the importer.
Compared with the traditional mode, the block chain-based technology reduces the use of manual steps and paper files, eliminates the inefficiency caused by labor and time difference problems through the efficient block chain technology, and can realize all-weather high-frequency transactions. Safeguard the complete and complete implementation of commercial contracts and relevant trade regulations by eliminating human factors through smart contract. The high security of the block chain can also make all data tamper-proof, forgery-proof, distributed storage to achieve a financial level of security, eliminating security issues at the system level.
Vision of WTT Public Chain
The forms of block chains are mainly divided into public blockchains, consortium blockchains and fully private blockchains. Public block chain refers to a block chain that anyone in the world can read, anyone can send a transaction, and the transaction can be effectively confirmed, and anyone can participate in the consensus process. Consortium block chain refers to a block chain whose consensus process is controlled by a preselected node. Fully private block chain refers to a block chain whose write permissions are only in the hands of one organization.
WTT is a completely anonymous and untraceable encrypted public chain and token created by the WTT team under the Singapore Sino-Africa Trade Development Foundation. The WTT team’s vision is to use the international trade retail business application system to build a universal, fully functional, high-performance, rich application scenarios, easy-to-use and user-friendly public chain system and related infrastructure, and to build a block chain 4.0 ecosystem that supports various applications on anonymous public chains.
The WTT team focused on the block chain infrastructure and platform layer core technology, and constructed the unique and completely distributed anonymous P2P network communication protocol, the unique and composite transaction clustering consensus mechanism and mining mechanism, the support of transaction anonymity protection, and Turing’s complete smart contract. WTT supports the functions of third-party asset issuance, inter-blockchain communication, multi-chain integration, etc. It can land in the actual application field in the form of public chain, alliance chain, private chain, etc.
The WTT team’s vision is to realize the commercialization and ecological application of all-round value systems such as payment, cross-border commodity trade, community economic application and assets, break through various key technologies of value transmission network, build a global value internet, and provide a basic network for various value transmission applications. The WTT ecological platform connects “block chain+commercial ecological application+community economy” together in a new way, forming an unprecedented digital world application ecology. The ecological chain and the ecological circle are interlaced with each other to form a matrix structure, which together form a complete and open cycle of the ecological system. Relying on the team’s profound understanding and accumulation of the financial industry, as well as the adherence to the decentralized belief and liberalism, the WTT team will lead an anonymous network era with safe and fully free assets.
