Blockchain – the technology that underlies cryptocurrency – has tarnished its reputation for being a good tool for criminals. However, this technology can actually be useful in many areas of human endeavor, from presidential elections to supply chain planning. Blockchain can help protect consumers from tainted food, counterfeit medicine, fraud, and illegal trade.
How blockchain affects the supply chain
With existing technology businesses and consumers can know exactly where food has been and at what time. They can also know its nutritional value and possible allergens. However, they do not provide any information about what is actually happening at each point in the supply chain. This can fix the blockchain if applied correctly. The use of this technology can give companies a competitive advantage by providing data on the origin of goods.
For example, blockchain allows you to trace the entire supply chain of goods from manufacturer to consumer.
In this case, each deal or transaction is recorded and added to the distributed database chain as a new fragment, which is manually assigned a unique multi-valued numerical cipher. This fragment stores data about time, date, participants, transaction amount, and, importantly, information about the entire network. Here, any information transfer occurs in the form of a chain of blocks, where each block always contains information about the previous block.
Imagine: 90% of the world’s foreign trade turnover is delivered in containers. During the delivery of each of them, on average, 30 links of the logistics chain are involved (including shippers, consignees, carriers, customs, fiscal, regulatory authorities), between which there are more than 200 units of information interactions. It is assumed that each of the links in the chain will be able to make its entry into the blockchain using a smartphone, and this will eliminate the need to issue tons of shipping documents at every stage of the journey. The introduction of digital technology for exchanging and storing data in real-time could make a real breakthrough in supply chains.
Examples of blockchain use by famous companies
Retailer Walmart was one of the first to believe in the bright future of blockchain, testing the technology on the supply of mango in the United States and pork in China. The company believes that its implementation will improve the efficiency of inventory management and ensure the safety of supplied food, which Walmart considers especially important after the outbreak of salmonellosis in 2006. At that time, using paper documents, it took the company about two weeks to identify the source of the infection. The blockchain will allow you to get complete information about any batch of goods entered into the database in a matter of seconds, proponents of the technology say.
Blockchain provides transparency of the supply chain. In doing so it benefits the end consumers, who will rest assured that products are safe, fresh, free of GMOs and unwanted additives. They can know for example, that the purchased tuna was not poached. This was done in order to protect itself from such accusations that the British startup Provenance began to use the blockchain. Blockchain technology allows the company to track the movement of tuna. This helps to control its catch and delivery.
EverLadger uses a blockchain supply chain to prove the source of origin in the diamond trade.
The startup Assetcha.in uses the blockchain to increase the security of storing valuables.
The Midasium company uses the blockchain to conclude online rental agreements in the real estate market.
The list of companies that already use this technology can be continued for a long time, as well as possible areas of use of blockchain in logistics. The important thing is that you need to make a choice: to keep pace with modern technologies or to ignore them.