Today, technology has a tremendous impact on the fundamentals of the economy, business and government. They change people’s understanding of trade, property and the interaction of market players. The change of business models has led to a need for a technology that can ensure the transparency and security of all related processes – Blockchain.
According to CB Insights, the blockchain will soon transform such industries as banking, finance, stock trading; cybersecurity; education and academic records; voting and election systems; car sales and leasing, car co-ownership, ride-sharing services; IoT (Internet of things – smart devices, sensors, sensors, transmitting data) and integrated devices; forecasting and statistics; music, real estate, healthcare, insurance, trade, logistics, cloud services, sports management, tourism, energy efficiency management, loyalty programs, personnel management and whole countries, jurisprudence, selling and tracing weapons, inheritance, charity and this is not the whole list .
Here it is important to realize that blockchain is not only bitcoin, a cryptocurrency that has been talked about and written about over the past few years. There are a few scenarios of the possible use of this technology: within an organization or within the framework of the interaction of individual companies. Today we will consider one of it.
How does blockchain find the application for the supply chains
As more and more participants in the global logistics market become puzzled by the increasing transparency and reliability of supply chains, leading IT companies are pushing the idea of using blockchain technology for this purpose.
Thus, the international IT company IBM has already offered some large companies from various fields of activity to test their developments based on the blockchain principle. According to the IBM development project, more than 1,500 companies were able to operate with almost 500 million US dollars and to attract more than 4% of funds from the total capitalization of the company. This means that almost every second investment of the giant of the IT industry is already associated with supply and contractual obligations with IBM.
The Hyperledger international Blockchain consortium was launched by the Linux Foundation in 2015 and currently unites more than 115 companies from various fields, including finance, automotive, healthcare, IoT and aviation. The main goal of the consortium is to create a single open-source blockchain platform that will allow organizations around the world to implement blockchain technology in their business processes.
WalMart retailer was one of the first to believe in the bright future of blockchain, it is testing new IBM technology on the supply of various products in the US and China. At that time, when paper-based processes had been used, it took the company about two weeks to identify the source. Technology proponents say that the blockchain will allow to get complete information about any consignment of goods listed in the database in a matter of seconds. Preliminary testing has already given good results: according to the report for the second quarter of 2018, the retailer team was able to receive almost $ 140 million through blockchain projects.
EverLadger uses blockchain in the supply chain to confirm the source of origin in the diamond trade. Startup Assetcha.in with the help of blockchain increases the safety of storing valuable things. With the help of blockchain, Midasium company concludes on-line agreements on rental housing in the real estate market.
The startup Yojee (Singapore) has already been working for over a year. This technology platform provides powerful logistics capabilities in supply chain management, uses artificial intelligence and distributed registry technology. It replaces the dispatcher, monitors the status of orders in real time, creates invoices, manages tasks. The company assures that they already work with 30 thousand vehicles and customers from Singapore, Australia, Cambodia and Indonesia.
The blockchain will also help in the fight against fraud and delivery errors because one of the important advantages of the technology is an instant and parallel update of information for all participants in the logistics chain. The company Maersk, which has begun to test the technology on several routes of container lines, is already preparing to receive billions of dollars in savings with the successful implementation of the blockchain.
Imagine that 90% of world trade in the world is delivered in containers. On the delivery of each of them, on average, 30 links of the logistic chain (including consignors, consignees, carriers, customs, fiscal, regulatory authorities) participate, between which more than 200 units of information interactions occur. It is assumed that each of the links in the chain will be able to make its own entry in the blockchain using a smartphone, and this eliminates the need to issue tons of shipping documentation at each stage of the journey. The introduction of real-time digital data exchange and storage technology could make a real breakthrough in the supply chain. The technology will help to measure not only the location but also the temperature, humidity and state of the power supply in real time.
Since 2016, Rotterdam Port, the largest trading port in Europe, has been testing the Blockchain logistics technology, and this could be the starting point for developing the level of transparency in the industry. The project has the support of more than fifteen public and private sector companies based in the Netherlands with the assistance of the Ministry of Economic Affairs.
According to the creators, this blockchain project is unique in that it covers the entire logistics supply chain. Over the next two years, consortium members will test applications for the exchange of logistical and contractual information between the parties.
There should be no monopolist in blockchain technology
Not only global technology enthusiasts believe in perspectives of blockchain but so does Microsoft! Recently it became known that a competitor of IBM, Microsoft, is also developing in this direction, together with JPMorgan Chase and other major financial corporations, taking the Ethereum alternative virtual currency technology (Ethereum) as a basis. Partners responded to the fears of many banking organizations that IBM will become a monopolist in the blockchain field and impose its own software products on everyone.
The Azure Blockchain-as-a-Service (Baas) cloud blockchain service was launched at the end of 2015, and since then Microsoft has been working with customers and partners to get feedback and suggestions on the missing parts of their solution so that organizations could implement blockchain applications.
In 2017, the company announced the launch of a new initiative called Project Bletchley. Its main purpose is to assist companies from various sectors of the economy, with the creation of a consortium to study and implement blockchain technology.
Microsoft also takes on an educational mission, talking about the nature and capabilities of the technology, as well as stimulating entrepreneurship and technology development, conducting hackathons, workshops and incubation programs around the world. If the same trend towards development continues up to the beginning of 2019, Microsoft will be able to rely on more than 4% of the logistics supply market for a high-tech product for users, which is almost $ 180 million in net profit.
It should be noted that the integration of blockchain technology into the logistics system continues to develop other areas of activity of many stakeholders. The search for new solutions in the supply of goods and services using the block system has already given a positive feedback and allowed this technology to become advanced in the IT industry.
It is important to note that many specialists and developers see a great future in this area. The only question is – how soon can the blockchain take over the world and cast its net? It seems that there is quite a bit left.