BLOCKCHAIN
Not everyone understands it, perhaps, but
blockchain is more than just an enabler for
cryptocurrencies. The Editor gets to grips
with the subject.
Drop the word blockchain into a conversation today and
people will generally nod in a knowing manner. But is this
nodding a true measure of the audience’s understanding?
Blockchain as a concept, allegedly, dates back to 2008, when
it was coined (appropriately enough) in conjunction with the
emergence of Bitcoin as an alternative currency. The word was
utilised to describe the public transaction ledger that was essential
to the concept of this rival currency. Its adoption gave credence to
the concept of an e-currency, one that would allow an individual
to transfer funds to another without either party knowing the
other in the transaction. Thus the requirement for a central body
(or a bank) was obviated at a stroke.
It was a masterful invention, that cannot be denied. But
blockchain quickly attracted the attention of other sectors, who
could also see a value in its level of anonymity. According to
Deloitte’s survey last year, it’s more of a business model enabler
than an actual technology, although in its most basic sense
it can be labelled a ledger system. That said, blockchain itself
doesn’t actually do anything, unless it is paired with a solid use
case, where it can serve as a sort of Trust-as-a-Service (TaaS) to
ecosystem participants.
The cargo and freight sectors, by virtue of their logistic
chain character, are suitable beneficiaries for this development
and blockchain adoption is enhanced with the introduction
of digitalisation techniques, something that is growing in
importance with the passing of time. Indeed, several of the big
parcel carrier names, including FedEx, DHL and UPS, have already
signed up to it, a clear indication of the concept’s potential.
The year of the blockchain?
In March this year a Blockchain Summit was held in Washington,
DC. During the event, concerns were raised over the possibility
that the federal government could stifle this innovation in the US,
in? although regulators were more
reassuring, tending to endorse
the enabler.
According to US
Representative Tom
Emmer, who co-chairs the
Congressional Blockchain
Caucus, 2019 could well
be the year of blockchain.
This year, he avowed, would
separate hype from reality; this
year would also witness the
harnessing of blockchain in
the most appropriate sectors,
in order to lower costs and
increase efficiency. To achieve
this, though, co-ordinated
government oversight would
be necessary.
The benefits of blockchain,
com
adobe.stock. -kugelwolf ©to those whose job it is to
know, are straightforward
enough. Blockchain is aimed
at increasing the efficiency
and transparency of the
supply chain: this means
that it can have a beneficial
impact on everything,
from warehousing through
delivery to ultimate payment.
Importantly, consensus is
acknowledged: there should
be no dispute in the logistics
chain in connection with
transactions, because all the
involved entities view the
same version of the ledger.
By doing away with the
(traditional) centralisation
process, a speedier transaction
is assured whilst cost is
eroded. The stage is thus
set for the freight sector: so
what’s the state of play?
Blockchain and the
logistics chain
According to Chris Fabre*,
Bitcoin inspired but didn’t
actually define the blockchain
industry.
“People often talk about
the benefits of the blockchain
but there is no such thing,”
he declares. “Blockchain
is a software category
encompassing very different,
even orthogonal technologies.
What they have in common is
that they process transactions
for parties using the software
and create consensus on
the state of the underlying
assets. Cryptocurrencies have
many issues that enterprise
blockchains don’t have.
22 August 2019 www.airlogisticsinternational.com
/www.airlogisticsinternational.com