Marco Polo Trade Finance Network Holds No More

02/25/2023 22:36 • AI & Tech Insights • 137 views

It is reported that the holding company of Marco Polo Trade Finance Network (formerly TradeIX) entered bankruptcy in Ireland. The blockchain network has more than 30 bank members, such as Commerzbank, Bank of New York Mellon and SMBC. Its supporters include ING Ventures and BNP Paribas. Recently, a potential $12 million deal with Bank of America failed, and the company failed to find a substitute investor. The company’s liabilities exceed its assets by 2.5 million euros (2.6 million dollars). The total debt is 5.2 million euros (5.5 million dollars), of which the tax bureau owes 2.6 million euros (2.7 million dollars). The latest account submitted is the account for 2021, showing a loss of nearly US $29 million and a cumulative loss of US $85 million. The largest external shareholder is Kistefos, followed by Japan’s SBI, ING, SMBC and BNP Paribas.

Marco Polo, the blockchain trade financing network, has gone bankrupt

Interpretation of the news:

The news of Marco Polo Trade Finance Network going into bankruptcy in Ireland has sent shock waves across the financial industry. The blockchain network, which had more than 30 bank members, including Commerzbank, Bank of New York Mellon, and SMBC, had received significant backing from ING Ventures and BNP Paribas. However, a potential deal of $12 million with Bank of America fell through, leaving the company with no substitute investor.

Reports suggest that the liabilities of the company exceed its assets by €2.5 million ($2.6 million), with a total debt of €5.2 million ($5.5 million), of which the tax bureau owes €2.6 million ($2.7 million). The latest submitted account for 2021 shows a loss of nearly $29 million, with a cumulative loss of $85 million.

The news of the bankruptcy has come as a surprise to many, as the network had gained recognition for its innovative approach to trade financing. The Marco Polo Trade Finance Network aimed to streamline trade finance by using distributed ledger technology to improve transparency and security through smart contracts. The company had been in operation since 2018, and its successful early years had garnered significant attention. The blockchain network was seen as a promising alternative to traditional trade financing methods, which were expensive, inefficient and lacked transparency.

The network’s failure has been attributed to various reasons, including a lack of adoption by industry players and operational inefficiencies that failed to deliver promised cost savings. Furthermore, the COVID-19 pandemic disrupted the global trade finance landscape and hampered the network’s growth plans.

In conclusion, the bankruptcy of Marco Polo Trade Finance Network has significant implications for blockchain technology’s adoption in the financial industry. It shows that blockchain applications must have a viable business model and solid operational efficiencies to survive. The sudden fall of this innovative trade finance network has come as a big blow to its supporters, members and the blockchain community, highlighting the risks associated with investing in start-ups.

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Marco Polo Trade Finance Network Holds No More

Marco Polo, the blockchain trade financing network, has gone bankrupt

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