BiTA board member, UPS, awarded patent for blockchain-related application

  (Photo: Shutterstock)

(Photo: Shutterstock)

The U.S. Patent and Trademark Office (USPTO) has awarded UPS with a patent they applied for six months prior in February. The title of the patent is "Autonomous services selection system and distributed transportation database(s)." The concept involves storing a multitude of various types of data within a distributed ledger network, including information about a given package's destination, its movement and transportation plans for shipment units. The patent also describes storing data from point of origin, to destination, as well as shipment parameters, generating a transportation plan, tracking and completion of the shipment, including payment, and even using blockchain technology.

UPS suggests using more than one distributed ledger in an effort to track a range of orders, "each providing varying information/data regarding respective asset types (e.g., shipment units and/or associated shipment units)."

"Thus, certain embodiments enable tracking of a first set of shipment units and a second set of shipment units associated with the first set of shipment units separately, thereby enabling the use of various smart contracts relating to shipping services and shipment unit handling in a bifurcated manner," the company wrote in a release.

The patent explains that as consumers demand faster, cheaper shipping while also demanding more visibility into the path of their shipments, new tools are necessary to track international shipments that involve multiple carriers. This is in the spirit of the blockchain standards organization that UPS joined in November of 2017, Blockchain in Transport Alliance (BiTA).

BiTA was formed by experienced tech and transportation executives to create a forum for the development of blockchain standards and education for the freight industry. The goal of the organization is to bring together leading companies in the freight technology industries that have a vested interest in the development of blockchain technology.

“Blockchain has multiple applications in the logistics industry, especially related to supply chains, insurance, payments, audits and customs brokerage,” Linda Weakland, UPS director of enterprise architecture and innovation, said in November. “The technology has the potential to increase transparency and efficiency among shippers, carriers, brokers, consumers, vendors and other supply chain stakeholders.”

A key phrase to note in the patent application is "automated determination." UPS intends for the software not only to track a package through multiple countries and carriers on a blockchain-based infrastructure, but it will also determine the optimal route for each package, and the idea is all this happens without human intervention. It’s totally automatic.

The idea is that as a package is tracked, necessary payments are triggered throughout each step. A major benefit of blockchain technology is the ability to immutably link delivery and payment on a decentralized ledger, allowing for instantaneous transactions triggered by the delivery itself and not a secondary action by the carrier. 

And for the foreseeable future blockchain remains inextricably linked to cryptocurrency. The patent also mentions that "virtual currencies" such as Bitcoin may be acceptable forms of payment in this system.

UPS shipped more than 5 billion packages and documents last year, according to its website, earning $54 billion in revenue.