Whether you are your company’s Chief Technology Officer or you are just somebody watching the news and reading trade publications, you’ve seen a number of things written and talked about the issue of blockchain. One of the most early and notable discussions of blockchain came courtesy of an announced partnership between IBM and Maersk.
Before we can look at what blockchain can do, we must begin with a basic understanding of the technology and what underpins it. Blockchain is an open distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. Blockchains power a cryptocurrency such as Bitcoin – an unregulated digital currency first created in 2008.
If you’re a fan of John Oliver and his work on Last Week Tonight on HBO, he did a great job explaining how blockchain works and why this distributed ledger system is so much more secure. Note: There’s a great metaphor involving Chicken McNuggets that explains why.
With a piece of information stored in a blockchain ledger, the likelihood of its alteration is reduced to zero because an encrypted fingerprint of that item (a document, a file, a piece of data) is shared across the ledger and if an attempt is made to adulterate that record, it invalidates the fingerprint and every one of those distributed sources knows it is no longer valid.
Turning to the supply chain, the ability to ensure validity and truth of data can be useful across a variety of places.
- Electronic logging devices used by truckers can ensure that the hours of service, distance traveled and time on duty are accurate.
- Blockchain could replace EDI as a preferred means of data transfer.
- Paperless trading and “smart contracts” – where payments are triggered based on activities such as shipment, clearance or delivery can be possible and automated.
- Fraud prevention against counterfeit goods such as medical devices or medicines can ensure that was is going to consumers is legitimate.
RIM are proud to be members of the Blockchain in Transportation Alliance (BITA) and have been asked to participate in a think tank within BiTA to establish standards and discuss the applications for blockchain within our industry.