Commentary
The panel, Blockchain: Where it’s Headed, at McLeod’s UC2018 conference was constructed to be a deeper dive into blockchain. The previous day featured the more standard “Blockchain 101” content that many in the industry continue to become more familiar with. If you need a brief catch-up, I’ve distilled it into four words. Ready? Blockchain is an “append-only decentralized immutable ledger.” That isn’t so hard, is it?
Actually, it is. There’s a lot of complex, abstract, and technical concepts to understand, and many in the supply chain want to know how it applies specifically to their field.
Understandably, industry participants want practical applications. They want to know what’s happening, and whether or not it’s an actual solution for their needs.
Toward that end, the panel consisted of blockchain experts, Ken Craig, Jordan Graft, and Dale Chrystie. Ken Craig is VP of special projects at McLeod. Jordan Graft is EVP of TriumphPay. Dale Chrystie is business fellow, blockchain strategist for FedEx. Each of the “blockchain rockstars,” or “blockstars” as I referred to them as panel moderator, are on the BiTA (Blockchain in Transport Alliance) Board of Directors. McLeod is a BiTA member as well, and if you haven’t yet heard of BiTA, founded in August of 2017, let’s just say it’s been a busy year.
Ken Craig gave an overview of what BiTA is doing. BiTA has 470 members and has received nearly 3,000 applications. It also comes from a diverse array of companies. Law firms, OEMs, service providers, IoT companies, TMS companies, trade associations (such as OOIDA), universities, industry participants such as carriers, shippers, rail, and air cargo companies. There are also insurance companies, brokerages, investment banking companies, consulting and audit services, marketing and recruiting agencies, and pharmaceutical companies. There are, finally, even real live blockchain companies.
For a little over a year now, BiTA has been organizing and performing important work with its standards committees: data formats, interoperability, finance, and technical compliance. There are also five BiTA think tanks investigating areas related to risk management, operations and asset utilization, driver marketplace, supply chain, and finance and business administration.
About BiTA, Dale Chrystie says that “blockchain is a team sport,” and that BiTA members need to be the “parents in the room” and work collaboratively on how the many points of contact need to come together for the interests of the whole.
The panel also addressed the blockchain news of the day, which is Walmart’s [NYSE: WMT] open letter to leafy green suppliers that starting January 31, 2019 they will need to get on the blockchain train and adopt IBM’s [NYSE: IBM] Food Trust blockchain. Generally speaking, it is seen as a positive development for the adoption and fundamental understanding of entering blockchain into the food supply’s mainstream. Certainly, there are big questions such as how does BiTA get the standards in place that affects the big carriers. No one knows yet who will be impacted and to what extent. All we currently have is the letter.
We do have other questions, however, such as the proprietary nature of IBM’s blockchain and the pay-to-play aspect. Much like Apple [NYSE: AAPL] co-founder, Steve Wozniak has said in various iterations: “Access to a free internet should be an American principle,” we tend to think of the idea of blockchain’s “decentralization” as an open-source concept. In a sense it is, as Jordan Graft pointed out. Part of IBM’s blockchain is built in the open source Hyperledger Fabric network. Hyperledger Fabric is gaining momentum as the infrastructure for creating trust networks in a wide variety of industries.
Dale Chrystie also used the illustration that is now referred to as the “mango pilot.” Last year, Frank Yiannas, Walmart’s VP of food safety, asked his team to trace a package of sliced mangoes back to their source. It took them six days, 18 hours, and 26 minutes. After Walmart used the software developed with IBM to track mangoes from a farm in Mexico to U.S. stores over a 30-day period, the same exercise took 2.2 seconds.
Some food safety experts have criticized the application of blockchain in the food supply suggesting that the food is only as safe as the person entering the information. They argue that blockchain is perfect for completely digital assets, but the flaw is when you have a commodity. The panelists spoke briefly to these critiques suggesting that at the very least the reverse logistics of sourcing a bad product or bad player would at least be dramatically more efficient.
The panel touched on an array of other topics from smart contracts and how they might be applied, to the idea of protecting your data when companies want to provide “solutions” for what you can do with it, to what kinds of companies actually need blockchain and who could do perfectly well with just a nice IoT solution. They also touched on how cryptocurrencies and the idea of how tokenization still gets in the way for people trying to understand and utilize enterprise applications.
Dale Chrystie sees blockchain at about a 3-5 on a scale of 100 in terms of maturity. However, once the leaps start happening “you’ll see it at a 30 then a 70.” In other words, it’s hard to predict how the scalability of blockchain enterprise solutions will mature. Technology tends to grow exponentially. While some in the media seem to think that people are only joining alliances like BiTA due to FOMO (fear of missing out), it’s driven by a much more powerful reality, as difficult as it may be for some to grasp. Now, with Walmart’s most recent dictum, things are getting real (if they weren’t already).
Dale Chrystie also offered another tangible illustration for how to assess the blockchain reality. He said, “I don’t know what’s going on inside my car when I’m getting from point A to B. I do know that I’m getting somewhere.” He went on to suggest that explaining how the internal combustion engine works would be hard to explain, but especially when it was in its infancy, no one was exactly sure how it might be used.
So, whether or not blockchain becomes “a whole new internet” remains to be seen, but there seems little doubt the dam of applications is breaking. Those who were too cool for school really will miss out—they’re already missing out.
In the Q&A afterwards it seemed to all come back to the mango, however. People wanted to know why it took so long to trace that mango back in the first place.