Not heard of Blockchains? You will soon

Not heard of Blockchains? You will soon

IoT and Industry 4 are creating data on an unimaginable scale and it needs new tools to handle and extract information. One of these will be blockchains. If you have not heard of blockchains in manufacturing, you are not alone.

They first came to prominence as a robust and secure way of trading Bitcoins and other cryptocurrencies. Now, the same technology is moving into a wider range of commercial applications from banking and healthcare to supply chain management and IoT.

With production based around the world, goods travel through many hands before reaching the consumer. There is no transparency in the process and no easy way to audit the supply chain. The same is true as users transfer data through cyberspace, they both need assurance it is free from tampering. Blockchains provide a robust and secure way of acheiving this.

Using blockchains give users and producers more accountability. For example, knowing exactly where and when goods entered the supply chain avoids many problems associated with identifying counterfeit goods.

What are blockchains?

A blockchain (click here for graphic) is a decentralised digital ledger (database) shared across a network of computers. It starts with a block created by combining several records or files. From this, applying a mathematical function creates a digital record with a unique standard-length file name called a hash code. Once added to a chain, a block (record) is extremely difficult to change. This is because making any change to a record, results in a new hash code.

To ensure all the copies of the database are the same, the network makes constant checks of its integrity. Management of the blockchain is by a peer-to-peer network (with no master). All peers use a common protocol that specifies how they should communicate with each other and the creation and validation to new blocks. As each new block in the chain is linked to the previous block, it means a change to a block needs all later blocks to change too. For this to happen requires most of the peers to agree, and this is the basis for its security.

Blockchains are secure by design and act as an enabling tool where keeping a correct record is important. Uses include medical records, identity management, food traceability, and even voting. Currently, there are at least four types of blockchain networks — public blockchains, private blockchains, consortium blockchains and hybrid blockchains. Blockchain domain names are another growing use of blockchain. Unlike regular domain names, blockchain domain names are entirely an asset of the domain owner and controlled by the owner through a private key

Where did they originate?

Development of the original blockchain concept dates from 1991 as a way of ensuring the integrity of digital records. It was later referenced and developed by ‘Satoshi Nakamoto’ in 2008, as a safe transaction method for Bitcoin cryptocurrencies.

What about the risks from hacking and fraud?

Layers of security are in place to protect blockchains and help ensure digital trust exists. Blockchains move data amongst computers, but massed computing power is also a threat and presents a major challenge.

According to IBM, a blockchain based supply chain management systems built on a shared distributed ledger provides an indisputable record of all data related. Within a private blockchain, transaction validation and processing are by participants that are already recognized by the ledger. It allows companies to also exploit this internal data to improve their upstream and downstream

Blockchains and IoT

In industrial applications, the increased use of Cyber Physical Systems (CPS) also adds to their relevancy. CPS including IoT and edge and cloud computing requires safe, secure and fast handling of large volumes of data. Blockchains add increased visibility and efficiencies across supply chains. The distributed architecture removes latency.

Blockchains provide both organisations and consumers with an accurate data record to track an item’s the entire product life cycle. They are as applicable to manufactured goods as to farm products because the blockchain follows the goods.

Several major Japanese manufacturing companies, including Mitsubishi Electric are planning to share data using blockchain. The goal is to share data to enhance competitiveness and production quality. In addition to product information, they plan to share information with suppliers on how their manufacturing equipment is performing.

The expectation is that smaller companies will also benefit from sharing data with larger ones.

 

 

 

Leave a Reply