Exploring the CyberMiles ecosystem: Blockchain in the supply chain industry
Demanding ever-greater transparency across the supply chain, a #CMusecase
Already highlighted here is how rapidly the eSports industry is growing, as is the case with valued commodities like wine. A perhaps less exciting, but equally important industry though is the supply chain management industry. For one, it’s absolutely massive, experiencing year-after-year, double-digit growth. In fact, according to Gartner, the Supply Chain Management (SCM) market will exceed $19 billion in total (software) sales by 2021.
But for me, supply chain presents quite a tantalizing problem to solve. It never has made sense, for instance, that I spend money on something without knowing hardly anything — or anything at all — about where it comes from even. Diving deeper into the supply chain, I had a stark realization that there are (of course) real people behind all of the things we buy, not just systems. What is neat about blockchain though is that you can communicate information peer to peer and know that it can be authenticated, if not trusted. Compare that to today’s Internet, which requires a third party for every online activity. My point? It’s that the information is now in an open data format — it’s challengeable — so you can contribute or ask a question, and the public can challenge and hone that information. With supply chain finance, global growth, stabilization, new opportunities and stronger relationships can be the prime benefits.
The Value of Transparency
Overcoming humanity’s biggest challenge to technology adoption and organizational change — humans. We are inherently lazy. Skeptics may think that people just don’t care, but I think, given the choice, people actually do. There are those who seek slightly more meaning in the products that they buy and want to know a little bit more about them, but even that mindset isn’t yet mainstream. Just like with crypto, which has been around for a decade now, there are early adopters. However, for the prospect of streamlining and increasing transparency to take hold, there must be a very mission-driven business with a strong social purpose that people embrace. Apply technology to working with a community of fishermen in the Maluku Islands. Random? Not when you can track proven social sustainability claims with daily catches along a complex supply chain. Provenance’s work in the SE fishing industry was one of the first real case studies highlighting the huge potential of blockchain application to complex supply chains that encourage social good.
How can we apply this more broadly within the supply chain? Let’s take a look at some blockchain-based components:
- Buyers receive extended invoice due dates, which can be double the original length of time.
- Suppliers extend credit to buyers and receive (near instant) payment on their approved invoices.
- End users (i.e. consumers) can view the entire lifecycle of a product before it hit the shelf.
- The efficiency of global trade can be greatly improved (see also: automation).
- Fraud such as counterfeiting can be minimized due to quality assurance sensors that track the location of materials within a supply chain.
Simply put, this cycle benefits all parties, for instance:
- The supplier gets financing at lower rates.
- The manufacturer gets ample time before needing to pay the supplier.
- The lender gets interest on the loan.
What continues to slow transparency in commerce is implementation. Businesses face challenges of getting buy-in from the entire supply chain, and integrating into existing systems. Perhaps a catalyst could come in the form of pioneers taking the leap, reaping the benefits, and thus pressuring the market to shape up or get left behind. With modern, global supply chains interlinked, payment terms can be odious, prompting cash shortages for buyers and sellers alike. Buyers want better payment terms from suppliers, and suppliers want better payment terms from buyers. This push-and-pull of competing objectives can cause a bottle neck in the supply chain.
The Challenges That Remain
That blockchains can store immutable data in a censorship-resistant, tamper-evident way enable their securing and transporting digitally native tokens. If/how though we’ll be able to digitally represent physical assets in a trust-minimized way is still TBD.
Something else to consider: How do you verify the authenticity of the data being input into the blockchain? If Oracles are to have “skin in the games” — to be financially liable for their actions — then they’ll have to charge quite a bit for their services. They also will need to pay for insurance. Their owners or operators therefore could be sued, presumably, in a human court. There’s still a lot of work to be done. In the short term, I predict that the declining lack of trust in traditional marketing communications only will continue to decline as consumers turn to other sources for answers.
The famed Vitalik Buterin made a great case for this regarding food and medicine, since drugs are the most counterfeited item on the planet. Verifying authenticity is definitely a use case for blockchain, no matter what the item is, and there are companies already building out the infrastructure (or protocol) to address this need. If radical transparency becomes the norm, particularly in supply chains for businesses, we’ll be moving towards a fantastic new phase for sustainability. And that is something to be very excited about.
The CyberMiles Solution
Blockchains will enable economic progress, driven by a greater number of individuals and organizations. CyberMiles, a new public blockchain protocol designed and optimized for commercial applications, launched Blocktonic.io, an online marketplace that’s one of the first e-commerce platforms to support cryptocurrency only. Blocktonic, which accepts the CyberMiles Token (CMT) as its exclusive payment method, offers nearly 100 products including dozens of electronics.
If you have use cases (e.g. DApps and side chain ideas) for the CyberMiles blockchain, please email business@cybermiles.io for collaboration/ investment opportunities.
