Exploring the Potential: Smart Contracts and the Fight against Trade-Based Money Laundering in International Trade

Fintracester Inc., Khulna, Bangladesh
Email: romel.sharif@gmail.com (M.R.S.)
Manuscript received January 25, 2024; accepted March 19, 2024; published May 24, 2024

Abstract—In the evolving landscape of international trade, this comprehensive exploration delves into the paradigm shift enabled by smart contracts, challenging the traditional role of Documentary Credits (LCs). By prioritizing transparency, the article showcases how the integration of smart contracts revolutionizes proforma invoicing submission and offers a robust mechanism for scrutinizing over and under-invoicing—an entrenched tactic in Trade-Based Money Laundering (TBML). The innovative concept of introducing a bidding process within smart contracts opens doors for global participation, reducing entry barriers for startups and entrepreneurs, thereby transforming poverty into prosperity. These transformative mechanisms, rooted in blockchain technology, mark a compelling shift towards combatting TBML and fostering a more inclusive and dynamic global economy.

Keywords—smart contracts, international trade, transparency, Trade-Based Money Laundering (TBML), over and under invoicing, blockchain technology

Cite: Md Romel Sharif, "Exploring the Potential: Smart Contracts and the Fight against Trade-Based Money Laundering in International Trade," International Journal of Blockchain Technologies and Applications vol. 1, no. 2, pp. 38-47, 2024.

Copyright © 2024 by the authors. This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).