IBM and Maersk Announce TradeLens, Leveraging a Blockchain for Global Trade

blockchain globe

While advocates have promised a lot from blockchain technology in the supply-chain management sector, little tangible action has taken place on this front.

That may be changing, thanks to TradeLens , a new global supply-chain management solution announced recently by IBM and Maersk. The companies said that more than 90 organizations across the globe are actively participating in the platform, making it the most significant use case to date involving blockchain technology and global trade.

Blockchains and Supply-Chain Management: Many Promises, Few Solutions

Supply-chain management and global trade are among the most obvious use cases for blockchain technology. By recording data about the movement of goods on a blockchain, organizations can create transparent, fraud-resistant databases to track the movement of material. They can also take advantage of smart contracts to streamline trades and payment.

This type of solution is particularly useful when trade takes place across borders and government authorities cannot unilaterally guarantee or enforce fair trading and record keeping.

Lots of news outlets have covered how transformative blockchain technology promises to be for supply-chain management. They've done the same for global trade .

To date, however, the excitement surrounding blockchain platforms within these contexts has not matched reality. Most real-world implementations of blockchain technology for supply-chain management and global trade have been limited to narrow use cases involving specific organizations, like Walmart's use of a blockchain to help track the food that it sells or the use of a blockchain by specific banks for trade finance.

TradeLens: Putting Blockchain Technology into Practice

TradeLens is poised to change that, due largely to the sheer number of organizations participating in the platform and the array of regions and industries that they represent.

TradeLens, which was developed by IBM and Maersk, a Danish logistics company, is "an open and neutral industry platform" that "promotes a more efficient, predictable and secure exchange of information in order to foster greater collaboration and trust across the global supply chain," according to the platform's website.

Data is recorded on the blockchain to ensure transparency and enable organizations to track and share information related to global trade, such as when a particular item was shipped and when it was received.

TradeLens also features an application layer on which TradeLens itself, as well as third-party developers, can build and share software tools for interacting with the platform.

Although IBM and Maersk announced TradeLens to the public very recently, the platform has already achieved significant adoption. According to the project, more than 20 port and terminal operators spread across at least three continents are using the platform. Customs authorities in Europe, South America, Australia, the Middle East and East Asia are participating in the platform.

Those figures highlight the geographic breadth of TradeLens' reach, as well as the significant levels of adoption it is enjoying among government authorities and private companies.

On balance, it's worth noting that TradeLens remains quite new and is far from achieving universal adoption by all global-trade stakeholders. IBM and Maersk have said nothing about how extensively participating organizations are using the platform, or how many applications are running on it. It's also unclear how easily new organizations can join the network and which plans IBM and Maersk have for continuing to expand it.

Still, TradeLens is significant because it represents by far the largest and most pervasive real-world use case to date of blockchain technology for global supply-chain management. Indeed, measured in terms of the number of large organizations that are participating, it's one of the biggest enterprise collaborations of any type around blockchain technology.

At a minimum, the platform will help to provide a proof of concept for large-scale use of blockchain technology within supply-chain management and global trade, and drive further enterprise interest in the power of distributed ledgers.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

More Related Articles

Sign up for Smart Investing to get the latest news, strategies and tips to help you invest smarter.