Banking giant HSBC has completed the first blockchain-based letter of credit transaction denominated in yuan, Reuters reported.

The transaction involved the cross-border shipment of LCD parts and panels from Hong Kong-based exporter MTC Electronic to its parent company, Shenzhen MTC. It was carried out using the Voltron blockchain platform and marked the first such transaction to use yuan.

As per the report, the blockchain-based platform allowed the parties to exchange the electronic documents in 24 hours. For context, the exchange of documents by traditional methods usually takes around 5 to 10 days.

HSBC has been carrying out a number of letter of credit (LC) transactions via Voltron in the past couple of months. This includes a live LC transaction between Australia and China executed in April.

Ajay Sharma, HSBC’s regional head of global trade and receivables finance for Asia-Pacific, said that while these transactions were primarily individual pilot cases, they are working towards a full proposition which could see the commercialization of the platform.

“We are hoping that we will have something by end of the year, maybe the first quarter of next year, where will we know from Voltron what it costs, at which point, a lot of banks who might be sitting on the sidelines will be able to make a decision,” Sharma said.

“Clearly we are hoping that through this technology, the unit cost of doing a transaction comes down, along with other benefits, such as speed.”

HSBC is one of the founding members of Voltron, which was officially announced in October 2018. Other founding members include Bangkok Bank, BNP Paribas, CTBC Holding, HSBC, ING, NatWest, SEB, Standard Chartered, Bain, CryptoBLK, and R3.

Voltron is a blockchain-based open industry platform to create, exchange, approve, and issue LCs on Corda, R3’s blockchain platform. In May, it completed trials involving the simulation of multiple digital LC transactions with more than 50 banks and corporate.

Last month, Standard Chartered completed its first blockchain-based cross-border LC transaction in the oil industry with PTT Group.

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