The economic landscape in 2020 is completely global. Goods are produced and shipped all over the world at record speeds, requiring an intricate network of coordination and communication between manufacturers, suppliers, shippers, logistics companies, and retailers.
While the internet-of-things (IoT) was an important step in connecting these channels, blockchains and cryptocurrencies are set to be the next great breakthrough in supply chain management. This makes supply chain management altcoins some of the best altcoins to buy in 2020.
How can blockchains help?
Supply chains still face major problems in the 21st-century. These issues increase liability and costs, while simultaneously slowing down the time it takes to take a product from production to the end consumer. Among the issues supply chains face are:
- Product authenticity – Counterfeiting is a major concern for brand name products. By providing a trustless proof-of-authenticity, brands can give consumers more confidence in their purchases. This is especially important in certain industries like pharmaceuticals and automotive where inauthentic products can be extreme safety hazards. Products that are tracked from start to finish on the blockchain can easily be verified as authentic.
- Environmental impact – With the growing concern of climate change, consumers are more prone to gravitate toward products that are environmentally friendly. Consumers are more prone to purchase products that can have their environmental impact traced. throughout the manufacturing process, giving them the utmost confidence they are purchasing products that do not add to climate change.
- Product recalls – When a food product is recalled it is a major headache. All affected products must be located throughout the supply chain, a major undertaking for any company. When a blockchain-tracked product is recalled each affected item can be traced and the appropriate parties automatically notified, thereby increasing the speed of product recalls.
- Payments – Companies across the supply chain can find it difficult to collect payments in a timely manner. Utilizing smart contracts, payments can be automatically processed after an event is triggered, such as the delivery of parts or verification of product testing.
The major players
Yes, the world’s second-largest cryptocurrency does have its hand in global supply chains. By utilizing the ERC721 token standard, each physical object on the supply chain can have its own unique identifying token to be tracked throughout the manufacturing and distribution process. At the same time, as one of the most established blockchain networks, Ethereum has the longevity and trust that many other blockchains do not. This has led to the network already being used in some test operations. In fact, Coca-Cola is testing the Ethereum network in a project that will coordinate data for suppliers, bottlers, and franchises.
Using its proprietary Tangle infrastructure, the IOTA network can process transactions significantly faster than blockchain networks. Using this technology, IOTA is touching each and every point along global supply chains, along brands to analyze new data points and increase efficiency. IOTA can also ensure that proprietary data is not accessible to third-parties, keeping intellectual property and trade secrets safe. The project has already seen success in the farming sector as well as the fashion industry.
The Singapore-based company has always had its eye on supporting supply chain management. The company already has partnerships with huge brand-names, such as BMW, DNV GL, PwC, Walmart China, and more. By using Radio Frequency Identification (RFID) sensors, NFC, and/or QR codes embedded within products or labeling, the VeChainThor blockchain can track products throughout the supply chain in real-time. The VeChainThor blockchain has two native cryptocurrencies, VET which acts as the economic token on the network, and VTHO which is used to execute smart contracts.
Similar to VeChain, WaltonChain utilizes RFID tags to track products. WaltonChain introduces a unique hybrid of proof-of-stake and proof-of-work consensus mechanisms to maintain security across its network. Concurrently, it is implementing side chains so as to avoid any network congestion that might come with high usage of its network. The company’s executives have decades of experience at Korean Standard Products Association and Samsung, giving them plenty of knowledge on how to create this one-of-a-kind technology.
Ambrosus is a more specialized supply chain project, focusing on the food and pharmaceutical industries. The project was originally built on top of the Ethereum network before migrating to its own blockchain platform. The Amber token (AMB) is used to fuel the entire network of product tracking and verification.
It’s been a long time since consumers trusted their favorite brands. But now with the help of blockchain networks, trust is being restored by increasing product transparency and verifiability all along the product lifecycle. Therefore, consumers and businesses alike will benefit from the introduction of blockchains into the supply chain.