As international trade and logistics continues to expand, more efficient methods are being developed to enable effective service delivery and value transfer. However, Blockchain technology is bringing another dimension to disrupt the logistics industry in areas such as transparency and efficient tracking.
A globally significant industry
John Monarch, CEO at Shipchain, notes that the logistics sector employs the most people in the world. He explains that as this sector expanded over millennia, it has required innovation to scale and sustain practicality for the growing human population. This is happening again at the time of writing, with the fourth industrial revolution.
Monarch tells Cointelegraph:
“Connected devices revolving around the Internet of Everything (IoE) need a higher level of security. Blockchain technology is a matchless solution in this regard because it provides the best protection through distributed ledgers, advanced encryption, smart-contracts and reduced intermediaries. As a result, this will tackle corruption, ransomware, theft, premium-fees and tracking issues.”
He concludes that once Blockchain networks begin taking their first steps on a mass-market level, they will save the international trade industry at least $50 billion per year. And upon maturity, Blockchain technology could save the logistics industry a whopping $500 billion annually.
The actual role of Blockchain
Blockchain professional Aleksandar Matanovic tells Cointelegraph that Blockchain technology will indeed work as a tool to improve processes by bringing inherent propertiesinto the industry.
“As in many other industries, I don’t see Blockchain as a tool to increase efficiency, there are much more efficient systems than Blockchain-based ones. I see it as a way to make systems more transparent, more robust and less dependent on intermediaries.”
The importance of effective tracking
The COO of BitLand, Christopher Bates, explains that one of the main issues with chain of custody is knowing when property changes ownership or custodianship. Bates uses a car’s history as an example:
“It is pretty important to know if a car has been in a major accident and has frame/structural damage, he says. “If there was an immutable accessible record that kept track of the car history, there would be no way a car salesman could sell a car that had been extremely damaged.”