Blockchain: the next big thing for ITS? Really?
A growing number of organisations in the ITS industry are exploring how blockchain technology could be used for ITS and mobility applications. So, what exactly is blockchain technology? What are the key current and potential applications in the mobility and ITS sector? And what practical benefits might it bring?
In basic terms, blockchain is a distributed ledger technology (DLT) made up of individual ‘blocks’ of data. It uses a combination of encryption, distributed computing, consensus and ‘immutability’ to ensure that transactions are carried out in a manner that can be fully trusted by all participants. As such, supporters say it is the first technology ever built that directly addresses the issue of trust by ensuring that there is no middleman or ‘honeypot’ that can be hacked. This is because no single participant can witness a transaction unless permitted to do so. Instead, everyone involved in the network must agree to the transaction - and transactions cannot be arbitrarily edited.
One area where several pilots are active is the transportation logistics sector, with a number of projects currently focused on reducing the cost of operations when shipping containers around the globe. One example is the cross-border supply chain solution being developed by Maersk and IBM, based on open-source, hyperledger technology.
“We have a perfect example in tracking containers end to end, the Global Trade Digitisation Framework,” says Norbert Kouwenhoven, industry solutions leader - public, HC&LS and global trade digitisation, authorities leader at IBM Benelux.
“This is focused on the container, rather than on the conveyance, but demonstrates all the basic features you need to make a ‘copy, change or paste’ towards a pure mobility platform.”
As Jim Beveridge, telecom and cybersecurity expert at ERTICO-ITS Europe, explains, shipping companies burdened with the capital expenditure of having to run hundreds of vessels and millions of containers are looking for ways to improve the return on their outlays and reduce their operational costs by digitising the complex documentation associated with clearing customs in multiple jurisdictions. Blockchain-type DLTs integrated with smart contracts are perceived by many in this sector as having the ability to simplify processes and reduce costs - simultaneously providing “extra trusted information on the position and quality of container cargo, eliminating fraud and errors and minimising the time products spend in transit”. Beveridge adds: “Building a digital shipping platform dedicated to simplifying custom clearance, improved inventory management will ultimately reduce waste and cost
.”