Blockchain solutions in logistics will transform the industry as we know it. The technology behind bitcoin and other cryptocurrencies lets people who do not know or trust each other build a dependable ledger. A blockchain is a distributed database that maintains an ever-growing list of records called blocks. The information in a block cannot be altered retrospectively as each block contains a timestamp and a link to a previous block. The nature of blockchains makes it function like a public, digital, distributed ‘ledger’.
“Blockchain has multiple applications in the logistics industry, especially related to supply chains, insurance, payments, audits and customs brokerage,” said Linda Weakland, UPS director of enterprise architecture and innovation. “The technology has the potential to increase transparency and efficiency among shippers, carriers, brokers, consumers, vendors and other supply chain stakeholders.”
The lack of efficiency, transparency and security across the global networks is precisely the problem blockchain technology is designed to solve. Blockchain, if adequately leveraged, will give customers the opportunity to participate in a freer, more transparent global trade, and potentially limit the need for brokers and lower intermediary costs.
IBM Blockchain solution for supply chain intends to add greater visibility and efficiency across the entire supply chain to deliver higher value to customers and trading relationships. As a move to implement blockchain solutions in logistics, Maersk Line, the world’s largest container-shipping company, has already teamed up with IBM to apply blockchain to track its cargo shipments in order to reduce the mountains of paperwork associated with each shipment. You can watch the IBM Blockchain implemetation for walmart below.
Blockchain’s key role in logistics
Given that shipping anything is a sequence of custody handovers, having an immutable record of chain of custody transaction makes it impossible to lose track of who is responsible for a piece of property during each handover. Blockchains will help to make systems more transparent, more robust and less dependent on intermediaries. Providing safety by tracking the chain of custody by implementing technology that decreases the potential of malicious action and creates better transparency with immutable record-keeping. Implemeting blockchain solutions in logistics will ensure the reduction of fraud and other malpractices in the organization and will continue to improve trust in your customers.