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How does the blockchain work? This simple question has a very complex answer, one that can be difficult to understand. We’ll try to break down this complicated concept for you.
A blockchain is made up of a network of computers, otherwise known as “nodes.” A node, or computer, is connected to the network through authorizing and communicating transactions through a client (which completes these transactions).
What kinds of transactions are we talking about? Transactions that are verified through the blockchain may include contracts, records, or another type of data. The most well-known use of the blockchain is cryptocurrency. Bitcoin is just one of the potential uses of this technology, and it was the very first, invented in 2008. Consider the blockchain as a digital accounting book, recording and transacting value—of any kind, not just money. But as far as blockchain goes, it is resistant to infiltration, and thus, a potentially safer way of making transactions.
According to blockgeeks.com, the basic understanding of the blockchain is this: “[p]icture a spreadsheet that is duplicated thousands of times across a network of computers. Then imagine that this network is designed to regularly update this spreadsheet and you have a basic understanding of the blockchain.”
The point of the blockchain is this: that all transactions can be verified through a linked delivery system that can be securely validated between nodes.
Where does the blockchain fit in with 3PLs? The blockchain can be of great benefit to the logistics industry, as it can improve the process of making transactions over the internet.
One important element of the supply chain is transparency. Every time a transaction is made, a history of the product is created, from creation of the product to a sale. The blockchain can help with logging quantities and transfers, tracing purchase orders and receipts, certifying specific properties of product, linking goods to labelling, and sharing information about the manufacturing process.
Here at Evans, we’re excited about the advent of the blockchain and the benefits it can bring our industry. If you’re interested in hearing more about how the blockchain can benefit you and our company, get in touch.