UPS announced that it has joined the Blockchain in Trucking Alliance (BiTA), an industry group focused on developing standards for blockchain-like distributed ledgers specifically for the freight industry.
The move illustrates UPS’ commitment to distributed ledger solutions, and to solving the obstacles to their adoption in the logistics industry.
Distributed ledgers have many potential applications in the logistics industry — UPS noted that they could be used for storing and sharing data related to tracking individual shipments, as well as insurance, payments, and compliance audits related to those shipments. That’s because distributed ledgers, like the blockchain that powers the Bitcoin cryptocurrency, are stored and shared across a network of different computers. Once data is validated and added to the ledger, it can be viewed by any member with access to the ledger.
This could make them incredibly valuable for sharing data among the many parties typically involved in freight shipments, including shippers, carriers, insurance providers, customs authorities, and institutions financing the shipments. It would also cut out a great deal of manual labor currently involved in recording and sending much of this information. That would drastically reduce back-end costs for freight shipping businesses — and is why 61% of supply chain executives surveyed earlier this year by research firm eft said their companies were exploring distributed ledger technology.
UPS said it is specifically interested in leveraging distributed ledgers for its customs brokerage business. UPS’ customs brokerage business is one of the largest in the world, and arranges cross-border shipments, including ensuring compliance with local regulations and paying duties, for UPS clients. The logistics giant is seeking to provide more transparency to its customers by digitizing all of the information generated by its customs business and sharing it via distributed ledgers. For example, a file in a distributed ledger on a cross-border shipment could be updated almost instantly with an alert to all of the involved parties when the shipment clears customs.
Distributed ledgers are still a very nascent technology, and more work is required to standardize them for logistics use cases. Most of the distributed ledgers today are blockchains powering different cryptocurrencies and were not designed with logistics applications in mind.
That means standards need to be developed by industry groups with large numbers of stakeholders to help create distributed ledgers designed specifically for logistics applications. UPS joins other large freight transportation providers, like CH Robinson, as well as a slew of logistics startups like Convoy and Transfix, in trying to accomplish that task through the BiTA.
- Explains how firms are already exploring ways to make use of blockchain in all sorts of IoT projects.
- Provides an overview of disruption in critical sectors including the supply chain and asset management.
- Analyzes how blockchain is poised to see rapid expansion as a tool used in IoT solutions that reduce costs, increase efficiency, and remove reliance on cloud-based platforms.
- What is the Internet of Things? Definition, Industries and Companies
- IoT Ecosystem - Forecasts and Business Opportunities
- IoT Market Size, Share & Growth Forecasts
- IoT Trends, Growth & Predictions
- IoT Devices, Applications & Examples
- Top IoT Companies to Watch & Invest In
- IoT Wearable Devices & Technology
- How IoT Will Affect Security
- IoT Reports