Blockchain Technology: Impact on Industry

BiTA is an industry group dedicated to establishing blockchain standards for the freight industry. It was formed by experienced technology and transportation professionals to create a forum for the development of blockchain standards and education for the freight industry. The group provides a platform to develop and embrace common frameworks and standards using which industry participants can build innovative blockchain applications. Wipro intends to use this platform to help ideate platform-agnostic blockchain standards for the logistics and transportation industry.

Craig Fuller, Managing Director, BiTA, said, “We are excited to welcome Wipro to the BiTA family. Our aim was to bring together leading companies operating in the freight technology industries that are interested in the development of blockchain technology. We look forward to working closely with Wipro’s blockchain experts to drive enterprise scale blockchain adoption for global transportation organisations, specifically around use cases such as supply chain traceability, trade finance, provenance, fraud detection and compliance management. Owing to Wipro’s strong domain and technology expertise, and dedicated focus on blockchain, we look forward to its support and contribution to define, design and develop blockchain standards definition for the transportation industry.”

So, what is Blockchain?

Blockchain is a tamper proof distributed database that holds records of digital events. Authorised users can access, view, or add to the data, but they can’t modify or delete. The original information is untamperable, with a transparent and permanent information trail, or chain, of transactions or events.

Think of it like this: If the entire blockchain were the history of banking transactions, an individual bank statement would be a single “block” in the chain. Unlike most banking systems, however, there is no single organisation that controls these transactions. It can only be updated through the consensus of a majority of participants in the system.

The opportunities are so vast, some pundits are already calling Blockchain the most important invention since the Internet itself. Experts suggest blockchain could become a universal “supply chain operating system” in the none too distant future.

In short, blockchain is a record-keeping mechanism that makes it easier and safer for businesses to work together over the internet. It’s a growing list of records, called blocks, which are linked using cryptography. Each block contains:

  • a cryptographic hash of the previous block,
  • a timestamp, and
  • transaction data (generally represented as a merkle tree root hash).

By design, a blockchain is resistant to modification of the data. It is “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way”. For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for inter-node communication and validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without alteration of all subsequent blocks, which requires the consensus of the network majority.

Blockchain is a brain child of a person or a group known by the pseudonym Satoshi Nakamoto in 2008 to serve as the public transaction ledger of the cryptocurrency, bitcoin. The invention of the blockchain for bitcoin made it the first digital currency to solve the double-spending problem without the need of a trusted authority or central server.

By allowing digital information to be distributed but not copied, blockchain technology created the backbone of a new type of internet. Originally devised for the digital currency, Bitcoin, (Buy Bitcoin) the tech community is now finding other potential uses for the technology.

“The blockchain is an innovative, incorruptible digital ledger of not only financial transactions but anything else of commercial value.

It can store millions of records of data in a totally impregnable digital vault and at the same time offer complete transparency”

Blockchain technology is considered to be a game-changer for decentralising infrastructure and building a trust layer for business logic. It is envisioned to be a technology that could propel us into the next industrial revolution, with new paradigms for doing business in finance, supply chain, transportation, shared economy, and many other industries.

Blockchain in Supply Chain – Benefits

Blockchain uses the distributed public general ledger and hence lends itself very well to improve confidentiality, integrity, and availability of information (the three key elements of any information security standard) in the entire supply-chain.

With Blockchain’s help, it is possible to:

  • reduce errors, increase efficiency
  • avoid product delays, predict demand better
  • eliminate fraudulent activities, enable genuine players
  • improve management, minimise / eliminate the bull whip effect
  • increase consumer/supplier trust, maximise profits
Key benefits include:

Scalability: Blockchain by design is highly scalable as it is a distributed database. All stakeholders in a supply chain are automatically integrated into the system and receive real-time decision support inputs.

Standalone: system that can work Independent of legacy systems. This makes implementation quick and hack-resistant.

Integrity & Transparency: Because the data is shared, edited, and unchangeable, it requires less administrative work and lowers charges for transactions.

Reduced Costs: The above benefits directly result in reduced overall supply chain costs which is a considerable component of the overall cost and directly contributes to the profit of the organisation.

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