If you have more than a passing interest in technology it’s likely you’ve heard of blockchain. This buzzword has been bandied around for a few years now and is increasingly being talked about within the context of the shipping industry. But what exactly is blockchain and what can it mean for ship owners and managers?
At its simplest, blockchain is a list of records - here called ‘blocks’. Each block is linked to the next using cryptography. Cryptography is the act of securing communications, particularly in the presence of a third party. Because each block, or record, contains a timestamp it can be distributed, but not edited, copied or deleted by an unauthorized user without detection, leading to greater transparency and more security.
Initially used for the digital currency Bitcoin as a type of virtual ledger, blockchain technology has since been applied to various other aspects of the online world. One way of looking at it now is to think of it as an online filing system which can hold any data, not just financial transactions, that needs to remain protected and uncorrupted and that can be shared and viewed in real time.
Blockchain technology is revolutionizing multiple industries and it has the potential to do the same for the maritime sector. Indeed various global shipping companies are already exploring its application within the industry by partnering with technology companies. The benefits are wide reaching and applicable, not just to ship owners, but also to importers, exporters, customs agencies, and transporters.
Blockchain may put an end to red tape
By streamlining the flow of files and records, blockchain has the potential to eliminate time- and money-consuming bureaucracy. That’s good news for you if you’re a ship manager who is sick and tired of filling out endless paper-based documents and forms when transferring cargo from your export and import clients. Another big bonus of implementing blockchain technology in the shipping industry is that you will have access to real time data and visibility, potentially eliminating delays and disputes - which, let’s face it, will no longer fly in our increasingly automated industry.
Blockchain increases efficiency
Blockchain works by ensuring that records and data relating to a job or client can all be stored in one place. This creates a convenient, online solution for an authorised person to be able to view all relevant documents without having to reach for physical files or contact a colleague or associate for a missing piece of paperwork. Blockchain enables you to say goodbye to lengthy, error-prone, non-transparent and confusing paper chains!
Blockchain is cost-effective
Because blockchain technology allows you to track shipments in real time it is also invaluable for planning ahead. Plus having access to all of this big data will allow savvy ship owners to analyse and predict outcomes that will enhance future operations, saving time and money.
Blockchain can improve security
Blockchain is vaunted for its secure handling of data. And with the constant threat of hacks and and malware attacks, that’s something no shipping operator can afford to take a risk with. That means that as well as making checking goods quicker and thus lowering the risk of incurring penalties for customs compliance, it will also improve cyber security and add an almost impenetrable layer of protection against data theft.