Utilizing Blockchain in the Aviation Industry
As technology becomes increasingly prevalent in society, new systems are being created to keep up. One of the systems that have been recently developed is the blockchain, and it is used to increase efficiency within financial transactions. Blockchain makes it easy to send, receive, store, and trade digital currencies; and is resistant to modification, making it more secure. It is a growing list of records, or blocks, that are linked using cryptography; every block contains a cryptographic hash of the previous block, a timestamp, and transaction data.
Companies can use the peer-to-peer network and manage cryptocurrency without the use of intermediaries. E-commerce is not a new concept and is used widely across many industries however, it is not widespread in the aerospace sector and only recently making any headway. Two of the organizations in aviation that are using and/or researching utilizing blockchain are the International Air Transport Association (IATA) and Honeywell.
IATA is a trade association of the world’s airlines. IATA Settlement Systems enables the movement of funds between airlines and their travel partners. Because of this, IATA is experimenting with its own cryptocurrency called the IATA coin. This coin would be a supranational industry-wide currency and would enable airlines and their partners to do business using a single currency; making payments faster, cheaper, and more secure.
The Travel Grid— comparable to an app store— is one of the prominent aspects in IATA’s vision for using blockchain. This supports a token, smart contracts, and identity management. Some of the apps that will be used through this system are for frequent flyer points, identity apps, b2b smart contracts, and tracking apps for baggage, cargo, and spare parts.
Honeywell has unveiled one of its first blockchain initiatives for aircraft parts. GoDirect Trade is a new e-commerce initiative and it allows buyers and sellers to communicate directly. GoDirect Trade utilizes blockchain to verify that the quality documents and images match the part being offered for sale. Honeywell is a large company in aerospace, not only do they sell their own parts, they procure and distribute pre-owned certified parts through Honeywell Aerospace Trading (HAT). Some of their products are wheel and braking systems, engines, microelectronics, cockpit systems, sensors, weather radar, and satellite communications.
Aviation is a global market, which makes transactions more complex and expensive. Using a system, such as blockchain, can be a great asset to a company and can greatly increase its efficiency.
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Posted on March 19, 2019