Blockchain allows data accumulation from multiple sources into a single immutable, secured, and validated database. One of the biggest advantages of Distributed Ledger Technologies is that data on the blockchain ledger cannot be altered. Why? They are secured by cryptography, which would prevent any unauthorized modifications. How can you use it in the TSL industry? We have prepared a short guide for you about what blockchain is and how it can help in the TSL industry.
We have prepared information material about blockchain adoption in the transport, shipping, and logistics industry (TSL). Check out our paper to read a brief history of blockchain technology, examples of smart contract applications in TSL, and an industry-specific implementation roadmap.
What is Blockchain?
Blockchain – also known as a distributed ledger – is a modern version of a centuries-old ledger. It enables multiple parties – who often don’t know or trust one another – to record information in a permanent, immutable, tamper-proof, and transparent manner on a decentralized digital ledger and on a distributed system without the aid of a central authority. The integrity of the blockchain is secured by trustless consensus algorithms and guarded by cryptography making it impossible to illegally append or modify historical data.
Blockchain Technology Development
Let’s take a look at a brief summary of how blockchain has evolved from its inception to the present day.
1991 – 2008 – Stuart Haber and Scott Stornetta work on distributed computing and the first blockchain
2008 – Satoshi Nakamoto publishes Bitcoin Whitepaper
2010 – First bitcoin transaction is carried out – the famous 10.000 BTC pizza purchase
2011 – Development of blockchain in digital payments and currency transfers begins
2013 – Blockchain penetrates financial markets
2014 – Financial companies start using blockchain beyond cash transactions. Vitalik Buterin and team commence work on Ethereum smart contract software
2015 – Permissioned blockchain networks are under development. Linux Foundation announces the creation of Hyperledger Project
2016 – Blockchain technology penetrates markets across industries
2017 – Blockchain In Transport Alliance (BiTA) is founded to drive the adoption of blockchain technology in the transport industry. IBM, Walmart, China’s Tsinghua University, and the Chinese e-commerce giant JD.com launch The Blockchain Food Safety Alliance to standardize the method of tracking food.
2018 – Blockchain market has grown to almost 4.3 billion USD. DLT has found application in almost all industries.
2019 – There is more and more new players. Blockchain start-up companies around the world had raised over 3 billion USD in investment funding
What is a Smart Contract?
A smart contract is a computer program running on the blockchain. When enhanced with trusted external data input (oracles), it can facilitate negotiations, verify terms of service fulfillment and enforce the execution of an arrangement between two or more parties.
What is an Oracle?
Oracles are trusted providers of external data. By design, a smart contract is not aware of any outside data or events. It resides inside a blockchain and knows only about the data stored on that blockchain. Oracles facilitate an interface between the distributed ledger and the outside world. They can range from IoT sensors, weather stations, or trusted information providers supplying relevant data.
How to implement blockchain in the TSL industry?
With the right partner to guide you through the process, embracing blockchain can be a simple transformation with a smooth learning curve. Begin by identifying a use case for distributed ledger within your organization. Once you have it, start with a cloud-based solution with no need to invest in new hardware or expensive in-house research. With only basic training, you’ll be able to take your first steps in that ecosystem:
- Step 1: Begin by augmenting shipment visibility – Initially, blockchain technology helped to improve visibility throughout the delivery chain. You can record each handover as an immutable transaction with a timestamp and shipment transfer location.
- Step 2: Enhance it with real-time IoT and oracles data – The subsequent step will require deploying blockchain compatible IoT hardware that can provide telemetry data in real-time. Enhanced with input from oracles, it will enable tracking and smart contract validation not just at but between the way-points as well.
- Step 3: Replace the entire paperwork with DLT – This will be the most complex and lengthy process as it requires cooperation from all parties involved, including governmental agencies. When successfully deployed, it will help with removing most of the analog gaps existing within and across organizations. It will help with driving the costs down by limiting delays in information flow and errors caused by manual data processing.
Blockchain use cases and examples
You can record data from sensors, GPS locations, etc. on the blockchain to enable smart contracts verification. If the delivery won’t meet the conditions, the system will enable automatically paying the penalty fines. Blockchain smart contract allows the payment process to be automatically triggered.
Do you want to know more?
The advantages of blockchain include transparency, security, or improved record-keeping, making it a perfect solution for many industries. We provide free workshops of discovery to customers interested in blockchain solutions. Let’s stay in touch!
And if you want to read about blockchain adoption in banking, read our report.