Bitcoin Global News (BGN)
October 15, 2018 -- ADVFN Crypto NewsWire -- A veritable horde of
sources exist that proclaim the unique ways in which the Blockchain
is already adding to supply chains and their
capabilities.
Today, Coindesk published an article that claims the global
consultancy KPMG disputes this case.
In other words, KPMG has now publicly stated that current
implementations of the Blockchain for supply chain do little other
than allow companies to “track and trace,” in a more transparent
manner.
Therefore, if this is taken as true, the overall media’s
representation of the Blockchain in this area has been grossly
over-exaggerated.
In response to this suggested gap in Blockchain utility, they have
significantly changed the focus of their existing Blockchain
R&D arm. In a precise sense, this means that they have moved
from financial technology related research to research in the niche
of global customs and trade.
As we all know, every process that involves entering or leaving an
individual nation with any product involves multiple government
agencies. With only this in mind, we could then ask: how does an
inherently decentralized technology fit into such a
picture?
Now, KPMG appears to believe that the answer is to offer these
agencies private Blockchains, which are a technological option that
has come under fire, as of late.
One chief way this is developing is that the private Blockchains
that banks have are being questioned, due to how they seem to be
fragmenting the Blockchain space even more.
If you are not quite clear on what this refers to, the general
argument here is that with more private Blockchains in one
industry, comes less knowledge of that industry’s ecosystem. This
is said to be because customers as well as suppliers are split into
Blockchains based on the specific company they are trying to
interact with, instead of being able to do business with multiple
companies at once.
While we are on the subject, as we have mentioned before, a
Blockchain is supposed to be centralized, if it is truly built with
Satoshi’s original goals in mind. In other words, Blockchain that
is owned and kept private by one company is not truly a Blockchain,
if you take this into consideration.
Even so, KPMG appears determined to push on forward. According to
the previously mentioned Coindesk article on the subject, earlier
this year they began looking at how the Blockchain could change the
specific area of tax and tariff work, related to global
trade.
Their first implementation of the Blockchain in these specific
areas, ended up being involving it in what is called “a simple
parts provenance exercise,” for a single aerospace part. Such an
exercise, however, is not as easy as it may seem at face value.
KPMG apparently told Coindesk that the whole process involved
thousands of pieces to make the single part, which had to be
procured from around 20 different sites.
Because this is true, we can actually begin to see how the
Blockchain might be useful in solving such a problem, beyond
tracking all of these components. For KPMG, the answer seems to
lies in cutting the human element out of processes like duty
drawbacks, for the most part.
In the context of the United States, a duty drawback is a situation
in which by law, 99% of the payments made on goods imported into
the country can be refunded, if they are then next, exported.
According to KPMG, this process also applies in European countries
in a similar fashion, though in both cases, it appears to be quite
complicated.
First, they include just about every fee that is collected when
goods are brought into a country.
Next, the terms of duty drawbacks do not seem to always include a
99% refund. In the situation described with this particular
aerospace component, the true terms of these refunds may be said to
change based on the countries from which its parts seem to have
originated.
Because of all of this, one can quickly realize that if this entire
situation was automated, every involved party would save a lot of
time and money. As KPMG’s research develops, the key may be
understood as whether or not they can quantify these factors for
interested agencies. In addition to this, it will be interesting to
see whether they can achieve any government buy-in.
By: BGN Editorial Staff