Validating a Blockchain Technology-Based System in Commodity Markets: A Measurement and Structural Model Assessment-Based Approach

Abstract

In recent years, commodity markets in India and in other parts of the world are receiving a significant amount of recognition because of blockchain. A commodity can be defined as an artifact or a thing that can be merchandized between two regions, states, or nations. In general, commodities can be broadly categorized as agricultural and non-agricultural. There exists several actors in a commodity trading ecosystem that usually get involved when commodity trading between nations needs to be performed, such as exporters, customs, importer, insurance, and importer bank, and each of them are assigned certain roles and responsibilities that need to be carried out such as L/C, BoL, factoring, exporting credit, and insurance. Blockchain is a DLT that can leverage commodity markets on the whole by supporting the actors and their set of associated activities. It has been observed that commodity markets face a lot of issues during the conduct of trade, which ultimately affects its business processes. The identification of pain points or issues w.r.t. commodity market-related business processes and easing them through blockchain, especially via systems approach, shall enable smoother functioning, thereby improving overall cost and efficiency along with enhanced digital security. This study aims to validate a blockchain-based system in commodity markets by means of a measurement and structural model assessment-based approach.