Trade finance still runs largely on paper. Letters of credit, bills of lading, invoices, and certificates pass between banks, shipping lines, buyers, sellers, and customs authorities. The first wave of blockchain platforms promised to change this. They put key documents and events onto shared ledgers. Several high-profile consortia launched trade networks, attracted major banks and logistics players, and then quietly shut down. TradeLens, we.trade, Marco Polo, and Contour all ceased operations within a few years. The common thread? Not a technology failure – a governance failure around ownership, control, incentives, and trust.
Meanwhile, a second wave of focused projects now gains traction. Electronic bills of lading (EBLs) and duplicate financing registries lead this shift. These projects tend to be narrower in scope, built on open standards, and governed in ways that keep competitors comfortable. For banks, shipping lines, fintechs, and corporate treasuries, the governance model now ranks as the single most important factor in predicting whether a network will reach scale.
This post draws on an episode of On The Block, Espeo Software‘s YouTube series on blockchain and decentralised technology. It examines the governance decisions that determine whether multi-party trade networks attract competitors or stall at pilots. We combine the key arguments from the video with lessons from consortium closures and current standards work to provide a practical reference for decision-makers.
Governance is the product: why it shapes adoption
Organisations evaluating a shared trade network do not primarily evaluate technology. They ask who controls the roadmap, who sees their data, and whether a competitor can use the platform against them. These governance questions determine adoption before a single API call takes place.
“Governance beats technology. Who controls the network matters as much as what runs under the hood, even if it is decentralised.”
– Przemyslaw Koper, CEO at Espeo Software
The first wave of trade finance consortia made this clear. TradeLens, built by Maersk and IBM, achieved real operational scale. It onboarded ports, customs authorities, and carriers. Yet it shut down because potential participants doubted that a platform closely linked to one carrier could fairly serve competing carriers. The technology worked. The consortium governance did not inspire enough trust for broad adoption.
On the banking side, we.trade, Marco Polo, and Contour connected groups of banks on shared distributed ledger technology (DLT) platforms. None moved beyond pilot volumes. Funding dried up before any network reached critical mass. In each case, decisions around ownership, cost allocation, and roadmap control contributed to the outcome.
Trade network governance is not a legal formality to settle after building the technology. It drives adoption. Networks that treat governance as an afterthought consistently fail to attract the competitors whose participation makes the network valuable.
Define the network’s purpose and trust boundaries
First-wave consortia commonly tried to digitise the entire trade journey in a single platform. This created enormous scope, high integration costs, and unclear value for individual participants. The second wave takes the opposite approach.
“Start with just one painful document or risk. Projects that focus on one thing, like the bill of lading or duplicate financing, are easier to explain, easier to integrate, and easier to justify in a business case.”
– Przemyslaw Koper, CEO at Espeo Software
Scope as the first governance decision
Defining which document, risk, or workflow the network covers sets the foundation. Scope determines which organisations need to participate, what data flows between them, and where trust boundaries sit. An EBL network has very different membership rules and data sharing policies than a duplicate financing registry. Trying to serve both within one governance structure creates unnecessary friction.
Minimum viable network
Scope also sets the threshold for usefulness. A duplicate financing registry delivers value once a meaningful share of lenders joins – even if not every bank participates. A full trade documentation platform needs buyers, sellers, banks, carriers, insurers, and customs authorities all on board before anyone sees returns. The governance model must honestly assess which type of network it supports.
Control model options and what they signal
Ownership and operation of a trade network send a strong signal to potential participants. Three broad models exist, each with different implications for competitor neutrality.
Operator-led model: A single company builds and operates the platform. Decisions happen fast, but competitors may hesitate to join a platform they see as favouring the operator. TradeLens illustrates this pattern.
Cooperative or consortium model: Founding members jointly own and govern the platform. This distributes control but can slow decisions if voting structures lack clear rules. we.trade and Contour followed this approach.
Foundation or neutral operator model: An independent legal entity operates the platform under rules that prevent any single member from dominating. This model suits interoperability infrastructure where broad adoption depends on neutrality.
The control model directly affects integration effort. An operator-led platform may change its data model or API without consulting participants. A foundation model typically requires a formal change process with member input. Enterprise architects and security leads should evaluate how much influence they will have over technical decisions that shape their integration.
Membership, voting, and roadmap governance
After choosing a control model, the consortium operating model must define day-to-day and strategic decision-making. Three questions matter most: who can join, how decisions happen, and who steers the roadmap.
Membership criteria
Criteria should be explicit and non-discriminatory. If banks must meet volume thresholds or technical readiness standards, the network should publish them. Hidden or discretionary criteria erode trust and signal that the network serves insiders, not the industry.
Voting rights
Some models give all members equal votes. Others weight votes by transaction volume or financial contribution. Neither approach works better in every case. The choice must be transparent and aligned with the incentives the network wants to create. Giving dominant players proportionally more votes may boost efficiency but risks alienating smaller participants whose collective volume drives network effects.
Roadmap control
Roadmap governance tends to generate the most friction. Concentrating roadmap control in a small technical committee risks building features for a few large members. Requiring full consensus on every decision risks paralysis. A practical middle ground uses tiered governance: a technical steering committee proposes changes, a broader member body ratifies major decisions, and an independent chair manages conflicts.
Incentives and economics that work in practice
Governance and network economics cannot be separated. A neutral-looking governance model will fail if the economics create perverse incentives or if integration costs outweigh the value participants receive.
“The economics and the politics did not line up. Some competitors were worried that the platform was too closely linked to one carrier. Others did not see enough value to justify the cost and effort of integration.”
– Przemyslaw Koper, CEO at Espeo Software
Integration cost as the key barrier
Each new trade platform with proprietary data models and APIs requires a dedicated integration project. Without shared standards, every integration becomes a standalone effort. Standardisation initiatives – shared data models and standard APIs from industry bodies – count as governance decisions, not just technical ones. Building on open standards cuts integration cost for every participant and lowers the barrier for new members.
Cost allocation and sustainable funding
In first-wave consortia, founding banks typically bore development costs. They expected transaction fees to cover operations over time. Volumes fell short, and funding dried up. Sustainable pricing models must balance competing goals: keeping onboarding costs low, generating revenue for ongoing development, and avoiding barriers for smaller participants.
Digitisation shifts who does the work and who gets paid. A platform that eliminates intermediaries without offering them a new role will face active resistance. Effective governance anticipates this and designs transition paths – through new service roles, revenue sharing, or regulatory mandates that force the shift.
Data access rules, privacy, and audit
Data sharing governance turns abstract principles into concrete technical requirements. Competing banks must share enough information to prevent fraud without exposing commercially sensitive positions to each other.
Privacy-preserving patterns
The duplicate financing registry offers a practical model. Banks submit financing requests to a shared registry. The registry checks for conflicts and returns a result – but no bank sees another bank’s underlying data. This delivers auditability and fraud prevention without forcing competitors to trust each other with sensitive information.
“Banks can check new financing requests against this registry. They don’t see competitors’ data, but they can see if something has been financed elsewhere.”
– Przemyslaw Koper, CEO at Espeo Software
Access control and dispute resolution
The governance framework must specify access rules clearly: what data flows, to whom, under what conditions, and for how long. It must also define audit rights – who can inspect the system, when, and with what notice. In permissioned ledger architectures, these rules map directly to access control policies, channel configurations, and endorsement rules.
Dispute resolution underpins trust in data sharing. When two parties disagree about a transaction’s validity or data handling, the governance framework must offer a clear resolution process. Without one, participants will minimise their data sharing and reduce the network’s value.
Exit paths, continuity, and resilience
TradeLens, we.trade, Marco Polo, and Contour proved that consortium exit planning is no theoretical exercise. Every trade network should answer three questions before launch.
Data portability
Participants must be able to extract their data in standard, machine-readable formats. Locking data into proprietary formats creates switching costs that may attract participants at first. Over time, though, this erodes trust – participants know that a network failure could leave their data stranded.
Continuity scenarios
The governance framework should address funding shortfalls, the departure of a major member, a change of ownership or operator, and full shutdown. For each scenario, it should specify who decides, what notice applies, and what the operator owes participants during the transition.
Standards as a resilience strategy
Open standards and interoperable APIs provide the strongest resilience. When a network follows industry-standard data models and interfaces, participants can migrate to alternatives with lower friction. This reduces the existential risk of any single network. It also gives participants confidence that their integration investment retains value even if the platform changes.
Governance checklist for banks, carriers, and fintechs
Use this checklist whether you evaluate an existing consortium or design a new network. These governance criteria should shape your participation decision and procurement criteria.
Governance design sequence for trade networks
Purpose and scope: Does the network define its scope clearly? Does it focus on one document, risk, or workflow? Can it reach a realistic minimum viable network?
Control and neutrality: Who owns the platform? Does a neutral operator or foundation run it? Can any single member veto or dominate roadmap decisions? How does the framework manage conflicts of interest?
Membership and decision-making: Are membership criteria published? How does the network allocate voting rights? Does a tiered governance structure balance efficiency with inclusiveness?
Economics: How does the network allocate development and operating costs? Does the pricing model sustain operations beyond the initial investment? Can new members onboard affordably?
Data and privacy: Which data flows, to whom, and under what conditions? Do privacy-preserving mechanisms protect competitive data? Do participants hold audit rights? How does the network resolve disputes?
Standards and interoperability: Does the network adopt open data models and standard APIs? Can participants integrate through existing infrastructure like Swift? Does the platform interoperate with other networks?
Exit and portability: Can participants extract data in standard formats? Does the framework cover shutdown, ownership changes, and continuity of service? Do clear notice periods and contractual protections apply?
“Make sure whatever you build or buy is based on open standards and can interoperate.”
– Przemyslaw Koper, CEO at Espeo Software
Frequently Asked Questions
A neutral governance model prevents any single member or operator from dominating ownership, roadmap control, or data access rules. Typically, an independent legal entity – such as a non-profit foundation or industry association – runs the platform under published rules that block conflicts of interest. Neutrality matters because trade networks need competitors to participate on the same platform, and any hint of unfair advantage discourages adoption.
Misaligned incentives, high integration costs, and unresolved trust boundaries hold most consortia back. First-wave platforms like TradeLens, we.trade, Marco Polo, and Contour showed that participants hesitate to commit when they fear the operator holds an unfair advantage or when integration effort outweighs perceived value. Reaching sustainable scale requires narrow scope, open standards, and governance structures that keep competitors comfortable.
Banks can use privacy-preserving patterns such as duplicate financing registries. In this model, banks submit financing requests and receive conflict checks without viewing each other’s positions. They can access such services through existing infrastructure like Swift APIs, removing the need to join a large new platform. The governance framework should explicitly define data flows, recipients, conditions, and audit rights.
The choice of data models (proprietary versus open standards), API specifications, change management processes, and roadmap governance all affect integration directly. Networks that adopt industry-standard data models and APIs cut integration effort significantly. The governance framework should also clarify how the network proposes, reviews, and implements technical changes so participants can plan their own development cycles.
A consortium exit plan should cover data portability in standard formats, continuity of service during transitions, dispute resolution, notice periods, and contractual obligations that survive closure. It should address funding shortfalls, departure of major members, change of operator, and full shutdown. Clear exit terms build participant confidence and lower the perceived risk of joining.
Measure adoption readiness through governance maturity, technical preparedness, and operational ownership. Key indicators include a documented and ratified governance framework, open standards with published API specifications, defined onboarding processes, and a minimum viable scope that delivers measurable value to early participants. Also verify that target jurisdictions legally recognise the digital documents the platform handles.
Further Reading
- Maersk statement on discontinuing TradeLens – Official announcement on the decision to wind down TradeLens and the factors behind it.
- ICC Digital Standards Initiative (DSI) – The ICC’s programme for aligning digital trade standards and promoting cross-platform interoperability.
- UNCITRAL Model Law on Electronic Transferable Records (MLETR) – The UN model law that provides a legal basis for recognising electronic trade documents.
- DCSA Electronic Bill of Lading standards – Open standards for EBLs from the Digital Container Shipping Association, adopted by major carriers.
- Swift – The global financial messaging network that banks use to access trade finance services, including duplicate financing checks.
- Espeo Software – Blockchain consultancy for payments, asset tokenisation, and DLT projects serving banks, fintechs, and corporates.
This post is based on an episode of On The Block, Espeo Software’s series on blockchain and decentralised technology, featuring Przemyslaw Koper, CEO at Espeo Software. Direct quotes have been lightly edited for readability.
