Digitization is the main driver of change in today’s world. In not too distant future, it will cause many industries, including the shipping one, to undergo major transformations. Right now, we are witnessing breathtaking developments in both private & public sectors, with the majority of commercial agreements being converted into smart ones. And when it comes to digitizing delivery services, blockchain is second to none.
What follows below is our take on how the shipping sector of today is likely to change in the near future thanks to DLT. We hope that both beginner & experienced entrepreneurs considering starting a blockchain-based business in the shipping industry will find information contained in it useful.
Pros of Using Blockchain in Shipping
Cost Reduction & Speed
Manually processing documents, even if they are emailed or faxed, considerably interferes with the logistics process. Unlike traditional methods, blockchain technology makes it possible for marine smart contracts to process operations & trigger actions which would, under normal circumstances, require human intervention. Making document exchange digital is, therefore, a cost-cutting method that will help businesses save on transaction costs.
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Digitization means that humans needn’t make any decisions whatsoever - all of them are made automatically. Thanks to that, terms of a transactions are met, errors reduced, intermediaries eliminated & the effectiveness of terminal & port personnel increased.
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Blockchain or DLT is a technology that enables all participants to have access to information about an individual shipment & conduct a reliable audit of all deliveries. Thanks to advanced encryption algorithms, a P2P network provides its members with secure & reliable communication channels. None of their credentials are disclosed without their prior consent & each of them has a right to protect their sensitive information.
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By enabling individual platform members to simultaneously gain access to the ledger & make use of encrypted information in real time, a tracking system based on a blockchain ensures more unparalleled safety & accuracy. That, in turn, makes it possible for forwarders & carriers to improve their logistical processes by tracking down the entire delivery process.
Safety & Immutability
Individual entries the ledger is made up of are reliably encrypted. Once there’s an entry in the ledger, it can neither be reversed, nor changed. And the same applies to documents which are exchanged in real time on blockchain platforms. All of that makes the likelihood of fraud minimal & dramatically increases safety of all operations
Looking for legal assistance with launching a blockchain platform in the maritime sector? Need an individual consultation with a lawyer on blockchain developments? We will be happy to provide you with one.
With the introduction of blockchain in various industries, the world as we know it will never be the same. And to ensure that this process is as smooth & trouble-free as possible, governments & regulators worldwide should work closely together .
Looking for legal advice on implementing DLT in maritime shipping? IQ Decision UK can handle that & a lot more.