The shipping industry is stifled by paper based processes, delayed detection of quality control issues, expensive proceedings for contract dispute arbitration, and massive amounts of documentation fraud. Even though the industry has been slow to adopt electronic documentation, it is growing more digitized and connected to the Internet. As it does so, it will become more vulnerable to cybersecurity threats.
To address these challenges, Chain of Things Limited, a Hong Kong-based blockchain+IoT startup, is holding a case study event on 24th of November in the midst of the Hong Kong Maritime Industry Week. The goal of the case study is to examine the suitability of utilizing blockchain technology – the distributed network technology behind Bitcoin – to replace traditional paper-based trade documentation and secure electronic documentation against cybersecurity threats.
The event will begin with an introduction to blockchain technology and how it is becoming the next Internet revolution. Then, a panel of legal and insurance experts from the shipping industry will discuss how shipping documents known as “bills of lading” are so important to the flow of trade, and provide examples of documentation fraud that plagues international trade. Following this, successive speakers will cover cybersecurity threats to electronic versions of shipping documentation, as well as the emergence of blockchain technology startups developing solutions specifically for the shipping and logistics industry.
In the afternoon session, Chain of Things will articulate its case study plan to link blockchain-based smart contracts and IoT sensor devices to revolutionize the “bill of lading” or trade documentation process. A smart contract is software code with programmed conditions, which are capable of facilitating, executing, and enforcing the negotiation or performance of an agreement using the security and interoperability of blockchain technology. The study will propose that sensor devices in containers or ships will collect data on the conditions of shipments and share that data in real-time to relevant parties and inform the smart contract, called a “Smart Bill of Lading.” The aim is to facilitate early detection of issues with cargo and faster remediation, as smart contracts may be written to self-execute a refund of the amount of money paid by a buyer to seller if a contractual condition is breached. This refund would occur without the need for litigation, providing a much greater level of transparency and accountability.
There are obvious limitations with this approach as breaches are never black and white but, through the event, Chain of Things will seek to encourage the beginning of a conversation surrounding the utility of blockchain+IoT technologies to modernize and correct expensive inefficiencies in the shipping industry. The event will also provide an opportunity to challenge the hypothesis of the case study as well as join Chain of Things in further developing “Smart Bills of Lading.”
Chain of Things highlights the following goals of this case study event:
- Define primary problems and inefficiencies within the shipping industry that blockchain + IoT can help correct.
- Identify and quantify the aggregate risk value of these problems and inefficiencies.
- Determine next steps for piloting a practical blockchain IoT proof of concept application.
Partners of the Chain of Things’ event include Women’s International Shipping & Trade Association (WISTA), Young Professionals in Shipping Network, Jen Advisors, and the Infiniti Lab.
Taking place on Thursday 24 November 2016, the location of the event is the Infiniti Lab, 2/F Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.
The schedule of the conference includes the following:
Registration & Coffee – 9:30 am
Morning Session – 10 am to 1 pm
*Introduction to Blockchain Technology and Smart Contracts
Jehan Chu, Jen Advisors & Ethereum Community– 10-10:30 am
*What are Bills of Lading?: Importance of Bills of Lading in Shipping
Panel of Shipping Legal and Insurance Experts – 10:30-11:15 am
–Jon Zinke, Partner, Keesal Young & Logan
–Catherine Smith, Senior Associate, Holman Fenwick Willan
–Chris Howse, Partner, Howse Williams Bowers
*Digitizing Bills of Lading
Paul Mallon, Co-Founder / Head of Customer Engagement & Legal, Bolero International – 11:15-11:45 am
*Digitization, Internet Connectivity & Cybersecurity Threats to Shipping
Marin Ivezic, Partner, PwC – 11:45 am-12:15 pm
*Overview of Blockchain Startups & Technology for Shipping & Logistics
Matthew Warner, Chain of Things – 12:15-1 pm
Afternoon Session – 2 pm to 6 pm
*Shipping Startups’ Showcase
-Blockfreight – Julian Smith, CEO – 2-2:30 pm
-OTDocs – Roberto Capodieci, CEO – 2:30-3 pm
*Chain of Shipping Case Study – “Smart Bills of Lading”
Hans Lombardo, Chain of Things – 3-4 pm
*Sensor Device Demonstration Workshop
Conor Colwell, Chain of Things – 4-5 pm
*Networking Drinks – 5-6 pm
Chain of Things (CoT) is a Hong Kong-based startup and think tank investigating the intersection between blockchain and Internet of Things. CoT runs regular case studies on different industries. The first case study was leveraging blockchain security in the Internet of Things. The second case study was Chain of Solar, which investigated the use of blockchain to secure renewable energy data. The third case study is Chain of Shipping, a blockchain based protocol for the development of Smart Bills of Lading and control sensor devices. The architecture of the protocol is to be interoperable with Ethereum and BigchainDB but is intended to be platform agnostic.