The Future of Trade Is Programmable

Trump’s tariffs show how broken global trade still is. Can code—not policy—finally fix it?

If you’ve ever eaten food, filled your gas tank, or touched anything made of metal, you’ve interacted with the global commodities trade. It’s a $33 trillion machine that underpins every economy on Earth. And right now, it's facing a reckoning.

This week, the Trump administration announced one of the largest single tariff actions in modern U.S. history—a sweeping set of import levies rolled out yesterday. The average U.S. tariff rate jumped from 2.5% to 22%, with targeted hits on China (34%), the EU (20%), and automobiles (25%).

Trump’s tariffs are a show of force, meant to reassert control over trade. But with better tools to verify trade in real time, maybe enforcement could target problems without distorting entire markets.

Beneath the tariffs, there is another, deeper story: global trade, long governed by handshakes, paperwork, and post-hoc compliance, is being rebuilt around real-time data and programmable infrastructure. Software—not policy—might soon become the operating system for how goods move, deals get priced, and risk is managed.

In today’s environment, risk isn’t something you want to discover after goods are already on a ship. If you’re buying cobalt or crude, you need to know where it’s from, where it’s going, and whether there’s regulatory exposure—before funds move. If we can surface that in real time, it gives traders speed, legal clarity, and leverage.

Digitization exists. So why is tracking still hard?

Trade has already gone digital in parts of the stack. IoT sensors monitor container humidity, temperature, and location. RFID chips track goods as they pass checkpoints. But these tools focus on logistics, not regulatory context.

The problem? Physical monitoring doesn’t equal regulatory clarity.

A crate of copper might be scanned by GPS 100 times across its journey, but that doesn’t tell you if it was swapped at sea, mislabeled for tariff evasion, or originated in a sanctioned zone. Tracking provenance and ownership across multiple intermediaries, often across jurisdictions, is still a massive challenge. For example, in 2024, Iranian oil shipments were found to be rebranded and rerouted using ship-to-ship transfers to avoid sanctions—despite containers having full GPS trails. Once uncovered, prices shifted, risk premiums recalibrated, and diplomatic fallout ensued.

Tariffs, export controls, and sanctions all depend on knowing not only where something is, but where it came from, who handled it, and whether it’s legally allowed to cross a border. That level of context is not captured by GPS alone.

So traders get creative.

• Satellite surveillance: Hedge funds and intelligence firms monitor ship traffic via AIS spoofing patterns and satellite heat signatures. They use this to track crude oil tankers, illegal transfers, and even production trends at mining sites.

• "Shadow" data modeling: Analysts piece together customs filings, port activity, and financial disclosures to infer where goods are really going.

• Sensor stacking: Some advanced players combine IoT sensor data with blockchain hashes to prove location and custody integrity. But few use this at scale.

Even in 2025, traders still rely on incomplete information and institutional trust. That makes the entire ecosystem vulnerable—to fraud, to sanctions risk, and to lost margin.

When a barrel of oil shows up unannounced, it can move markets or trigger sanctions. Commodity flows are now tools of statecraft. Mislabeled shipments can create diplomatic incidents or spark regulatory crackdowns. That’s why systems that validate and timestamp commodity origin are no longer a “nice to have.”

Why trade lags finance—and what that means

Finance has been increasingly automated for years. Real-time payments, algorithmic trading, compliance APIs, even tokenized assets. Yet commodities are still running on spreadsheets and emails. Why the gap?

1. Fragmentation: Commodity trade involves producers, shippers, insurers, port authorities, and banks—all with different systems.

2. Physical-to-digital disconnect: Unlike stocks or money, commodities are physical. Tying a digital signature to a specific ton of lithium or barrel of oil is nontrivial.

3. Regulatory variation: Trade laws differ by country, commodity, and moment. Automating for one jurisdiction doesn’t scale easily.

The longer this layer stays analog, the more vulnerable it is to inefficiency, fraud, and manipulation. If finance can clear billions in microseconds, but trade takes weeks to reconcile a shipment, the system breaks under modern pressure.

Why isn’t this already being done?

In a post-globalization era, a misrouted cargo ship can spark international retaliation. This is where tech platforms like Watr come in. Watr offers blockchain-backed system for pre-trade validation: who owns a shipment, where it came from, where it’s going, and whether tariffs or sanctions apply. A combination of data, from open-source to satellite imagery, is used to map commodity movement. The system is designed to validate compliance before a transaction takes place—ie, during deal structuring or settlement, when trade terms are finalized.

Watr isn’t the first company to attempt digitizing trade. It’s just a newer one, and one which is receiving well-timed attention given the impacts tariffs have on traders. Several efforts over the last decade aimed to bring transparency to supply chains and commodity finance, with mixed results. Some notable examples:

• komgo (2018) Backed by ING, Shell, ABN AMRO, and other major players. Targeted digitization of letters of credit and KYC for commodities trade finance.
  Why it struggled: Banks and traders weren’t ready to overhaul existing workflows. Trade finance is heavily paper-based, and institutions were slow to onboard.

• MineHub (2018) Focused on metals and minerals, with partners like Wheaton and IBM. Built a platform for digitizing mineral supply chains.
  Issue: Slow adoption. Physical asset tracking remains difficult, and integration with existing ERP systems proved cumbersome.

• Everledger (2015) Targeted commodities tracking, such as diamonds and rare gems, via blockchain. Worked with insurers and certifiers.
  Challenge: Niche market and high dependence on centralized institutions to input and trust the data.

The pattern: Great tech, wrong adoption model. Most attempts lacked either industry traction, regulatory compatibility, or the ability to link digital signatures to physical goods in a trusted way.

What to watch for

The big question now is whether systems like Watr will scale beyond pilot programs. Watch for adoption by large commodity firms, insurers, and regulators—especially in regions facing tariff volatility or sanctions risk. If these systems get embedded into procurement and customs workflows, the effect will ripple far beyond the commodity sector. The technology stack matters too. Platforms that can merge satellite imagery, customs filings, on-chain verification, and sensor telemetry are better positioned than those pushing pure tokenization plays.

If real-time compliance becomes the new baseline, entire classes of intermediaries—brokers, middlemen, and even legacy trade finance desks—may be displaced. (In short: digitization reduces informational friction, and wherever that friction used to be monetized by humans, their roles are at risk. This is what happened in payments, travel, insurance brokering—and now it’s creeping into trade.)

Turning trade into code introduces its own vulnerabilities. Blockchains don’t self-verify physical truth—they reflect whatever data they’re fed. If upstream sensors or human inputs are tampered with, a “verified” shipment could still be fraudulent. There's also a geopolitical angle: if digitization tools are controlled by U.S.-based or Western-aligned platforms, rival powers may reject them outright. Finally, technical overreach—trying to enforce too much too fast—could lead to new chokepoints in already strained supply chains. Digitization doesn’t eliminate trust problems; it shifts where and how trust must be secured.

Tariffs, borders, and the real goal

The core purpose of tariffs has never been about paperwork. It’s about control.

Governments use trade restrictions to shape domestic economies, project power abroad, and enforce security—especially when trust in international coordination erodes. President Trump’s recent rhetoric around drugs and smuggling from Canada and Mexico taps directly into this logic. If customs agents can’t verify what’s coming in, tariffs become a blunt enforcement tool. But here’s the twist: if digital infrastructure could actually prove origin, custody, and compliance in real time—across borders, vendors, and jurisdictions—it could reduce the need for across-the-board tariffs. Instead of taxing everyone to stop a few bad actors, border policy could become more targeted, efficient, and data-driven. That’s the real promise of programmable trade. Not deregulation, but smarter enforcement.

Watr and others are betting that trade’s digital transformation will start at the compliance layer. Not with automation for its own sake, but with programmable trust. When money moves faster than goods, it's the rules of the game—not the containers—that need to be upgraded.

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