Pioneer Solutions, a leading provider of commodity/energy trading and risk management solutions, announced today that it has launched a blockchain technology pilot project. The project aims to demonstrate Pioneer’s flagship C/ETRM software platform, TRMTracker’s, ability to integrate with blockchain technology.
Blockchain will change the way people think about exchanging value and assets, enforcing contracts, and sharing data. As part of the quickly evolving digital solutions, blockchain technology is still in the relatively early stages of development. Yet, true to its name, Pioneer recognizes the potential benefits of blockchain such as streamlined deal capture, confirmation and real-time settlement, improved liquidity, traceability and increased transparency. The distributed nature of blockchain technology also makes ETRM solution a single ledger that needs to aggregate exposures from various sources.
Pioneer created a peer to peer (P2P) smart contract for trading that utilizes a decentralized network architecture on Microsoft Azure. Data is stored in sequential blocks that make up part of a chain. This chain of data blocks is stored on the local computers of the members comprising the P2P network. Blockchain has various mechanisms in place to prevent fraud which provides a greater level of transparency compared to traditional systems. It also reduces operational costs as third-party intermediaries are no longer needed to verify transactions. These benefits make blockchain an attractive technology for energy and commodity trading.
Pioneer’s blockchain technology pilot project integrates TRMTracker with a blockchain application hosted on Microsoft Azure. Using TRMTracker, a trader initiates a smart contract that integrates in the Azure blockchain. Next, another instance of TRMTracker for the counterparty automatically fetches the deal from the blockchain. Once the trade has been approved by the counterparty, settlement and cash flows will occur automatically. The P2P smart contract automatically verifies each stage of the trade using a consensus protocol to prevent data tampering.
“Staying atop emerging technologies is of the upmost importance for us.”, said Uday Baral, Managing Principal at Pioneer Solutions. “With this pilot, we look forward to implementing enterprise block chain platform integrations and providing clients with the increased transparency and data security that blockchain technology provides”.
Pioneer Solutions is also an observing member of Blockchain Initiative Energie (BCI-E), an European Blockchain technology interest group with a focus on energy-specific business models and functionality. BCI-E was founded in late 2017 by EDNA Bundesverband Energie Markt & Kommunikation e.V. The organization was formed to educate and raise awareness of blockchain technology’s potential impact on energy markets.
Pioneer Solutions is a global provider of C/ETRM, environmental management and financial and regulatory compliance solutions. Serving utilities and trading companies across the globe, Pioneer’s Suite of flexible software applications deliver easy-to-use and integrated functionality for Trade Capture, Position Analysis, Portfolio Management, Risk Reporting and Settlement, thereby providing the insight and granularity to manage operations optimally. Our pioneering and award-winning software offers a user-configurable environment and designed for rapid deployment resulting in a lower total cost of ownership and enhanced customer satisfaction.