(Kitco News) – The adoption of blockchain technology is steaming full power ahead regardless of what happens in the crypto market as “Big Four” accounting firm Ernst & Young (EY) has announced the launch of EY OpsChain Contract Manager (OCM), an Ethereum-based solution using zero-knowledge (ZK) proofs designed to help the firm’s private business clients execute complex contracts.
“EY OCM helps enterprises to execute complex business agreements, supporting confidentiality, helping improve time efficiency, and achieving cost reduction, with automatic adherence to the agreed terms,” the company wrote in a press release.
The firm revealed the new service at the annual EY Global Blockchain Summit on Wednesday, saying the system “helps address the enterprise challenge of managing business agreements that run across internal and external operational and technology siloes.”
EY noted that enterprises face challenges when it comes to fully implementing and capturing value from their business agreements. “Spend gets fragmented across internal enterprise barriers, making it hard to track and qualify for agreed-upon discounts and rebates,” they said.
“Smart contracts enable aggregation of spend across systems and even external business partners and then consistently applies contract terms,” the release said. “EY OCM synchronizes data across business partners and uniformly enforces key business terms such as standardized pricing, volume discounts, rebates and strike prices.”
According to Zion Market Research, the global smart contracts market will grow to an estimated $1 billion by 2030 with a compound annual growth rate (CAGR) of roughly 24% between 2023 and 2030.
“We’ve identified from past client work that contract automation can improve accuracy while cutting cycle times by more than 90%, and overall contract administration costs by nearly 40%,” said Paul Brody, Global Blockchain Leader at EY. “With our zero-knowledge privacy technology, we have industrialized this capability, and we can now get these benefits at a fraction of the up-front cost.”
EY opted to launch on the Ethereum network because it’s a “truly decentralized” public blockchain that “helps avoid giving a strategic advantage to either a buyer or a seller and assists in eliminating the high costs of setting up and running a private network, as well as the risks that come from sharing sensitive business information with a centralized industry portal,” the release said.
“Deploying on a public blockchain is not only cheaper, but also much more scalable, helping enable many-to-many integrations on an open platform with no one company having an unfair advantage by controlling the network,” Brody said.
EY OCM can be utilized in existing enterprise systems through a standardized API, and it supports most business contract types, including volume purchase agreements, standardized rate cards, volume discounts, rebates, and price models that depend on market data feeds.
The solution is already being utilized by the first batch of test users, who are “implementing complex Power Purchasing Agreements (PPAs) that include market prices, strike prices with minimum and maximum purchase criteria,” EY said.
The accounting firm first started exploring ZK-proofs in April 2019 with the goal of building a blockchain-based platform for audit, tax, and transaction monitoring. OCM has been in development since at least September 2021, when the company selected Polygon to help build its blockchain enterprise product.
