When Maersk and IBM announced in January that they’d be working together to develop a blockchain shipping solution, these companies were among the first organizations to start looking at how the innovative blockchain technology could be used to support efficient and secure global trade. The new collaboration was part of a larger, two-year-old effort to build new blockchain- and cloud-based technologies.
A digital ledger that depends on transactions to be made in bitcoin or another cryptocurrency, blockchain records those transactions chronologically and publicly. Before the Maersk-IBM announcement, blockchain had largely been the domain of banks, brokerages, and other entities that wanted a more secure and reliable way to conduct global transactions.
Now it looks like that collaboration is not only coming to life, but also attracting a multitude of other organizations into the fold. In their recent announcement, Maersk and IBM said that their TradeLens shipping solution now has more than 90 global participants. Collectively, the platform is capturing more than 154 million “events” daily—a number that’s growing by one million per day.
A blockchain-enabled shipping solution designed to promote more efficient and secure global trade, TradeLens brings together various parties to “support information sharing and transparency, and spur industry-wide innovation,” the companies said in their announcement, noting port and terminal operators; shipping firms; customs authorities; and freight forwarders, along with transportation and logistics companies are all using the platform.
It works like this: by enabling digital collaboration across the multiple parties involved in international trade, the platform’s beta program (ClearWay), allows importers/exporters, customs brokers, trusted third parties (i.e., customs), other government agencies, and NGOs to collaborate in cross-organizational business processes and information exchanges—all backed by a secure, non-repudiable audit trail.
Jumping into the Blockchain Fray
Maersk and IBM aren’t alone in their quest to find the right combination to the blockchain-supply chain lock. In March, Purolator joined the Blockchain in Transport Alliance (BiTA), a consortium of leaders in the shipping and logistics industry that is creating standards for blockchain use. Formed by tech and transportation executives, BiTA is a forum for the development of blockchain standards and education for the freight industry.
According to the company, Purolator is looking into how to use blockchain to improve shipment visibility, agility and tracking, and delivery speed. “The applications for blockchain are endless and will provide the shipping and logistics industry with never-seen-before benefits,” Ricardo Costa, VP and CIO, said in a press release. “This is because the technology enables complete end-to-end visibility into the entire life cycle of a shipment transaction and all its connected parts.”
Costa further noted that vendor management, loss prevention and security, and billing and payments are just some of the transportation areas that blockchain can be applied to.
UPS and Walmart Step Up
As blockchain’s role in the supply chain continues to expand, companies like UPS and Walmart are also experimenting with how to use it across their international operations. Also a member of BiTA, UPS recently applied for a patent that utilizes blockchain and distributed ledger technology (DLT) to route packages throughout an international supply chain that may include multiple carriers, according to CCN.
“The patent application, which UPS originally filed on February 16, explains that while shipping logistics providers have become quite adept at optimizing package routing to increase efficiency and minimize costs,” the publication reports, “it is still difficult to coordinate logistics for shipments that involve more than one logistics service provider transportation network.”
Walmart is equally enthused about the prospects that blockchain brings to the supply chain, and has also filed for a related patent. The new patent aims to provide a technology for running in-field authenticating of autonomous electronic devices to enable secure deliveries, Cointelegraph reports. The patent specifies that “in exemplary embodiments, two autonomous electronic devices, such as delivery drones or household autonomous robots, can authenticate each other using embodiments of security procedures described herein.”
The Killer App for Supply Chain
Expect to see more companies jumping into the blockchain fray through the rest of the year and into 2019. Calling it the “killer app for supply chain management,” ComputerWorld’s Lucas Mearian sees the global shipping industry as being particularly ripe for a blockchain-related overhaul.
“Along with paper legal documents, much of the international shipping industry's information has been transmitted via electronic data interchange (EDI),” Mearian writes, “a 60-year-old technology.”
“But once shipping manifests move to API-based technology [application programming interface] on the new platform, shippers and everybody else in the supply chain will have more timely information and improved visibility,” Maersk’s Michael White told ComputerWorld. “One of the advantages of blockchain is the immutable record and trust people can have in it. If anything changes in a document, it's immediately apparent to all.”