The soon-to-be-released decentralized platform will facilitate lowering commodity prices.
The cost of living today is at an all-time high. While the increasing population and demand for commodities continues to drive the prices, the average increment in wage goes up at a much slower pace. The widening gap of demand and supply has made prices of commodities like fuel, grains and metals extremely volatile.
Global warming and changing climatic conditions are adding to the woes. One of the most evident examples of this phenomenon is the drought crisis in the west of the United States in 2012. Research shows that roughly 39% of the country experienced “severe to extreme” drought because of this unpredictable event, the retail prices of fresh food spiked as most of the harvests was in poor condition due to the shortage of rainfalls
Meanwhile the suppliers are working on fulfilling the demand, the trading industry needs to work towards delivering efficiencies in the process to ensure overhead costs don’t skyrocket the price of the commodities like grains and fuels.
With combined experience of over 100 years and expertise in physical commodity trading, founders of Arkratos Blockchain Solution have developed a blockchain based platform KRATOS to deliver efficiency, speed and transparency in the global trading process.
So how does this platform launch affect you?
The industry is subject to a lot of documentation fraud due to immense number of intermediaries. The quality assurance certificate, quantity certificate, origin of the product etc get tempered with. Hence third parties are hired to manage additional tasks which increase the transaction costs by 5% on average.
The industry still operates on decades old processes which include manual documentation and paper documents. It still uses post to deliver documents from one stakeholder to another which takes days or weeks to deliver. A minor error in document, late delivery or misplacement causes increase in overheads costs, which in turn gets added to the selling price of the commodity.
This is where KRATOS comes in. The soon-to-be-launched decentralized platform implements the blockchain technology to aid commodity trading companies by cutting out their needs for middlemen. It also digitizes paper contracts which removes the manual documentation errors and then converts digital contracts to smart contracts. Smart contracts are contracts which self-execute when pre-determined conditions are met. This means no delays in approvals or delivery of documents.
So, how does this impact the general population? Because of traders’ independence from external arbitrators, commodity trading organizations would be able to lower the production costs as a result. The price of the commodities themselves is also expected to diminish as operational costs become more affordable to the traders.
Developed with real time industry insight from advisors, who are pioneers in Physical Commodity Trading ecosystem with several decades of expertise in Commodity Trading, Mining, Shipping, Logistics, Agriculture, Blockchain, Innovation and Media, KRATOS already has 30 soft commitments with major trading companies across Singapore, Hong Kong, Malaysia, Indonesia and the United Arab Emirates.
KRATOS is a robust platform which is working on solving the actual challenges faced by the Physical Commodity trading industry, potentially lowering the price of your next meal.