UK Parliament Approves Bill to Utilize Blockchain in Country’s Trillion-Pound Trade Industry

The U.K. Parliament recently approved a bill seeking to harness blockchain technology in effecting its digital documentation goal within the trade industry.

Though witnessing growing adoption, Blockchain technology has not been wholly harnessed in the global scene. The same happened with the internet. Notwithstanding, as a testament to this growing adoption rate, the U.K. is one step closer to utilizing blockchain in its switch to a digital document system in the trade industry.

The Electronic Trade Documents Bill, which seeks to switch the trade industry’s documentation from paper-based to electronic-based, was approved Wednesday in the U.K. Parliament’s upper house, the House of Lords, as reported by CityAM UK.

Per information from the report, the bill will affect a remarkable transition in the U.K.’s trade industry’s documentation, as it allows for the digitization of trade documents within the industry. This will help curtail the industry’s reliance on paper.

As described within the Electronic Trade Documents Bill, blockchain technology will make an electronic-based system of documentation possible. Blockchain has proven its utility in several areas, such as the finance, music, and diamond industries. Though the government had been considering the cessation of paper used due to concerns of cost, sustainability, and weight, the initiative to implement this idea gained traction during the COVID-19 pandemic, exposing the shortcomings of several traditional systems.

The Commission drafted the bill, making the U.K. the first country to adopt a fully-fledged electronic documentation strategy when completely implemented.

Speaking on the recent development, Baron Holmes of Richmond MBE – life peer in the U.K.’s House of Lords – expressed his delight in the bill, noting that the U.K. is likely to witness the multiple advantages of adopting blockchain in the electronic-based documentation strategy.

Holmes, who also happens to be a staunch advocate of cryptocurrencies, highlighted the massive difference in the respective speeds of transferring paper documents and transferring them electronically. According to him, the former takes about ten days, while the latter will likely take about 20 seconds. 

“It is shocking that an industry worth around £1.266 trillion to the UK still relies on paper documents. This change will transform trade but also demonstrate the way in which the UK can be at the fore of ground-breaking tech enabling legislation”, Holmes remarked.

The Electronic Trade Documents Bill would not be the U.K.’s first interest in blockchain technology. The country’s central bank, the Bank of England (BoE), has indicated a massive interest in launching its CBDC on several occasions.

The BoE is looking towards a consultation this year that will help the government assess the feasibility of a UK CBDC. According to the BoE, its consideration of a digital pound is influenced by the drastic change in how payments are made, as introduced by DeFi and electronic measures.

Furthermore, in mid-June, the U.K.’s digital minister Chris Philip mentioned that the government is looking to make the country a “crypto hub.” Notwithstanding, he noted that the government seeks to establish a hub devoid of the abuses of blockchain and cryptocurrencies.