South Korea’s POSCO International Tokenizes Trade Receivables on Avalanche Blockchain

POSCO International Moves Trade Receivables to Avalanche Blockchain

POSCO International, South Korea’s largest trading company, has completed a transaction that converts trade receivables into digital assets on the Avalanche blockchain. This move is part of a growing trend to use blockchain technology to simplify trade finance processes.

The company’s U.S. arm worked with trade finance platform Olea and asset-backed finance technology firm Intain to carry out the transaction. The goal is to reduce paperwork and speed up financing by creating a shared digital record of trade receivables.

Trade receivables are amounts of money owed to a company after it delivers goods but before the customer pays. Traditionally, financing these receivables involves reconciling separate records held by buyers, sellers, and banks, which can be time-consuming.

How the Transaction Works

• POSCO International used Intain’s Avalanche-based blockchain network to tokenize trade receivables.
• Intain employed artificial intelligence to verify and reconcile invoices, purchase orders, and shipping documents before recording the receivables on the blockchain.
• The shared ledger creates a single record of ownership and status, potentially reducing delays in financing.
• This follows a similar pilot last month on the Injective blockchain, where POSCO also tokenized receivables.

What Tokenization Means for Trade Finance

Tokenization is the process of converting real-world assets, like trade receivables, into digital tokens on a blockchain. These tokens represent ownership and can be traded or used as collateral more easily than traditional paper-based assets.

By using a blockchain, companies can create a shared, tamper-proof record of transactions. This can help reduce disputes, speed up financing, and free up working capital that might otherwise be tied up in paperwork.

POSCO International, which generated $22.2 billion in revenue last year, operates in industries like steel, energy, and battery materials. The company has over 80 overseas branches.

Next Steps for POSCO and Partners

POSCO, Olea, and Intain plan to explore further applications of tokenized trade finance. These include using stablecoins—digital currencies pegged to a stable asset like the U.S. dollar—for cross-border settlements and developing digital treasury tools.

The companies aim to expand the use of blockchain beyond traditional assets like bonds and funds, testing its potential in payments, collateral, and trade finance.

What Is Confirmed

• POSCO International completed a transaction to tokenize trade receivables on Avalanche’s blockchain.
• The transaction involved partners Olea and Intain, who used AI to verify trade documents.
• POSCO previously conducted a similar pilot on the Injective blockchain.
• The company plans to explore stablecoin-based settlements and digital treasury tools.

What Is Still Unclear

• The exact value of the tokenized receivables in this transaction was not disclosed.
• No timeline was provided for when stablecoin-based settlements or digital treasury tools might be implemented.

Why This Matters for Businesses

Tokenizing trade receivables could make financing faster and more efficient for companies. By reducing paperwork and creating a shared digital record, businesses may access funds more quickly, improving cash flow and reducing reliance on traditional banking processes.

This experiment is part of a broader trend where companies test blockchain technology to streamline trade finance, payments, and other financial operations.

Sources

• CoinDesk
• Intain News