4 ms·

I never quite got my head around the value proposition for distributed ledgers in logistics ('smart warehouses / supply chains') and manufacturing ('industry 4.

by m00n 9y ago

I never quite got my head around the value proposition for distributed ledgers in logistics ('smart warehouses / supply chains') and manufacturing ('industry 4.0'). Say you want to trace eco paper rolls around the globe. What could the blockchain do for you? Who are the nodes/miners/coins in this application? When you suspect some intermediate in the paper chain to exchange eco paper for cheaper ordinary paper, how does distributing the information that he has X rolls on store prevent this scenario.

fsloth 9y ago
I think the OP stated that blockchains would alleviate the bureaucratic pains of international trade considerably. As bureaucracy requires labour, which is costly, I feel the value proposition is plausible. Another feature is not related to inventory. Ledgers that have acute accountability features attached, where some stakeholders may have incentives to fake the records. Like, for example transport truck driving schedules. Drivers are allowed only to drive so much, and there are penalties involved if the drivers don't rest enough. The main accountability measure here is the driving ledger. Whose maintainer has incentives to fudge it (the driver or the employer of the driver).
- donmatito 9y ago
  these are very good additional points, thank you
donmatito 9y ago
Sorry, I replied somewhere else, I don't feel like copypasting, but roughly the blockchain would not prevent false declaration. It would 1) considerably simplify the non-fraudulent papertrail 2) provide an auditable record for investigation in case of either fraud investigation or certification audit
JamesLeonis 9y ago
Logistics are a great place for this technology, but first you must purge your mind of Cryptotokens and their economics. They aren't applicable for a logistics use case. To understand this, first you have to understand why we structure mining. In the case of Bitcoin or Ethereum, you need a method that allows any arbitrary computational device to verify and add to a given blockchain. In lieu of trusting that device, the blockchain makes it do a massive amount of busywork, called mining, to prove it isn't bullshitting the network. Different implementations have different busywork, but it's designed to make it hard to change the network by arbitrary devices. This is why we can allow any untrusted device on the network. In the case of logistics, we are already operating under some amount of trust. This is through a mechanism of certification of goods, suppliers, verifying the goods are what they say they are, and the verification of those approvals and certifications. Even in a trusted environment, managing that coordination of certifying and verifying is slow, bureaucratic, and grows with the size of the logistic network. Additionally, many supply chains generally certify new entrants before allowing them to contribute. This creates a barrier to entry when establishing trust in the same way busywork creates a barrier for devices. Then there are whole units of auditors that go through and recheck all those certifications to make sure the whole chain is authentic with regards to the goods moving through it. Blockchain technology is a mechanism of creating certifications (signing a transaction) and verifying those certifications (miners/verifiers on a chain) that can operate in a decentralized but coordinated way. It allows for the whole system to better coordinate information and certification that used to be done manually. Did you notice I never mentioned tokens?
- shanghaiaway 9y ago
  You also did not answer the question. How do you verify that the physical objects the digital certificate is attached to, is actually attached to the things it is meant to certify, and not replacement counterfeit?
  - JamesLeonis 9y ago
    The same way you verify it now. The technology does not change the process of physically inspecting the product. It makes it far easier to coordinate the paperwork of certifying and verifying. At it's heart logistics is a global concurrency problem. The "locks" we use now are large sprawling bureaucracies that manually coordinate the transfer of information among many independently moving agents. Getting information into and out of this organization is a tedious, labor-intensive, and time consuming process. The technology that empowers cryptotokens is an alternate computerized concurrency management for this kind of information transfer and lookup that doesn't rely on a central organization or system.
    - ric2b 9y ago
      Ok, but if _someone_ is certifying who can and who cannot write to the blockchain, why wasn't this solved 2 decades ago with that someone running a database with an API front-end that all involved parties can use?
- donmatito 9y ago
  Thank you for expressing all this much better than I could
- natural219 9y ago
  I'd love to read more about this if you or someone else has written about it in-depth. I'm still not clear on the connection between "mining" (spending computing power) and the type of work that logistics professionals do when verifying parts of your supply chain.
  - 9y ago

by m00n 9y ago

fsloth 9y ago

I think the OP stated that blockchains would alleviate the bureaucratic pains of international trade considerably. As bureaucracy requires labour, which is costly, I feel the value proposition is plausible. Another feature is not related to inventory. Ledgers that have acute accountability features attached, where some stakeholders may have incentives to fake the records. Like, for example transport truck driving schedules. Drivers are allowed only to drive so much, and there are penalties involved if the drivers don't rest enough. The main accountability measure here is the driving ledger. Whose maintainer has incentives to fudge it (the driver or the employer of the driver).

donmatito 9y ago
these are very good additional points, thank you

donmatito 9y ago

Sorry, I replied somewhere else, I don't feel like copypasting, but roughly the blockchain would not prevent false declaration. It would 1) considerably simplify the non-fraudulent papertrail 2) provide an auditable record for investigation in case of either fraud investigation or certification audit

JamesLeonis 9y ago

Logistics are a great place for this technology, but first you must purge your mind of Cryptotokens and their economics. They aren't applicable for a logistics use case. To understand this, first you have to understand why we structure mining. In the case of Bitcoin or Ethereum, you need a method that allows any arbitrary computational device to verify and add to a given blockchain. In lieu of trusting that device, the blockchain makes it do a massive amount of busywork, called mining, to prove it isn't bullshitting the network. Different implementations have different busywork, but it's designed to make it hard to change the network by arbitrary devices. This is why we can allow any untrusted device on the network. In the case of logistics, we are already operating under some amount of trust. This is through a mechanism of certification of goods, suppliers, verifying the goods are what they say they are, and the verification of those approvals and certifications. Even in a trusted environment, managing that coordination of certifying and verifying is slow, bureaucratic, and grows with the size of the logistic network. Additionally, many supply chains generally certify new entrants before allowing them to contribute. This creates a barrier to entry when establishing trust in the same way busywork creates a barrier for devices. Then there are whole units of auditors that go through and recheck all those certifications to make sure the whole chain is authentic with regards to the goods moving through it. Blockchain technology is a mechanism of creating certifications (signing a transaction) and verifying those certifications (miners/verifiers on a chain) that can operate in a decentralized but coordinated way. It allows for the whole system to better coordinate information and certification that used to be done manually. Did you notice I never mentioned tokens?

shanghaiaway 9y ago
You also did not answer the question. How do you verify that the physical objects the digital certificate is attached to, is actually attached to the things it is meant to certify, and not replacement counterfeit?
- JamesLeonis 9y ago
  The same way you verify it now. The technology does not change the process of physically inspecting the product. It makes it far easier to coordinate the paperwork of certifying and verifying. At it's heart logistics is a global concurrency problem. The "locks" we use now are large sprawling bureaucracies that manually coordinate the transfer of information among many independently moving agents. Getting information into and out of this organization is a tedious, labor-intensive, and time consuming process. The technology that empowers cryptotokens is an alternate computerized concurrency management for this kind of information transfer and lookup that doesn't rely on a central organization or system.
  - ric2b 9y ago
    Ok, but if _someone_ is certifying who can and who cannot write to the blockchain, why wasn't this solved 2 decades ago with that someone running a database with an API front-end that all involved parties can use?
donmatito 9y ago
Thank you for expressing all this much better than I could
natural219 9y ago
I'd love to read more about this if you or someone else has written about it in-depth. I'm still not clear on the connection between "mining" (spending computing power) and the type of work that logistics professionals do when verifying parts of your supply chain.
- 9y ago