Despite the recent technological revolution, shipping still remains a traditional industry. The industry is a highly regulated and monitored industry which involves multiple governments, port authorities, customers, and container carriers etc. Because, of such highly regulated and monitored nature of the shipping sector, a container carrier has to share the same set of information/paperwork again and again with the governments and authorities for approvals and clearances.
In an effort to simplify the current procedures, the shipping industry has been inspired by the way that the bitcoin payment system works, namely – “Blockchain”.
With the help of Blockchain, the need to repeat the process of paperwork and getting approvals, clearances can be eliminated. Blockchain is the promising technology to bring complete transparency and process efficiency in the shipping sector.
Ari Marjamaa is Chief Transformation Officer in WWL ASA stays that no one reading the maritime press can have avoided the multitude of articles lauding the potential application of Blockchain technology to logistic supply chains. All those articles demonstrated that shipping is herd-like in its approach to the latest technological novelty that promises to cut costs and increase efficiency.
“In the current rate environment this, of course, makes perfect sense and in an era where we cannot turn around for reading about how the future of shipping depends on being smarter and more digitised, Blockchain is perfectly on-trend,” writes Mr. Marjamaa in his article “The future of Blockchain in shipping depends on open standards and industry-wide collaboration”.
The blockchain is an undeniably ingenious invention – the brainchild of a person or group of people known by the pseudonym, Satoshi Nakamoto. But since then, it has evolved into something greater, so what is Blockchain?
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, the tech community is now finding other potential uses for the technology.
Now, this technology promises to supersede hundreds of years of maritime commercial practice by replacing bills of lading and attendant transactional documents with a secure online mechanism to buy and sell goods.
Blockchain technology is poised to recover billions of dollars lost to coordination costs in both capital markets and the shipping industry, according to Arvind Krishna, the director of research at IBM.
Blockchains, he went on to say, are an ideal platform for aggregating and transmitting the certifications required at each step along the way and could save twenty percent of the cost of international shipping.
The maritime industry has not yet embraced blockchain technology, and whether entrenched and time-honored commercial practices will willingly give way to it is uncertain. The technology is not yet widely available or commonly leveraged into usable applications beyond Bitcoin, and whether and how quickly regulatory authorities will approve blockchain technology and its security protections remains to be seen. Some believe that blockchain technology advocates are a long way from proving its viability in commercial scenarios that involve identity authentication, or the protection of financial or private data.
