How Can Blockchain Disrupt Supply Chains in the Fashion Industry?

How Can Blockchain Disrupt Supply Chains in the Fashion Industry?

How blockchain technology improves the speed of supply chains in the fashion industry

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When receiving new shirts you’d bought online, or bought some jeans from one of the fashion stores on your street, the question that may have come to mind then was, how did these items get to be in my hands? The answer is supply chains. 

Supply chains in the fashion industry organize people, activities and information to move fashion products from the producer to the consumer. Although supply chains have undergone a revolution since the advent of the internet and artificial intelligence, that revolution might be incomplete without the introduction of the decentralized, distributed and public digital ledger known as blockchain technology.

Blockchain technology prevents product fraud in supply chains

Blockchain brings complete transparency to the fashion industry. Suppose you ordered a pair of shoes from your local store and it is labeled “Made in Italy” — how can you be sure that the shoe really was made in Italy? Visual Capitalist reports that counterfeit goods have caused damage worth around $300 billion to the global economy. 

Considering how large the counterfeit goods industry is, we can’t always depend on product tags to accurately show the origin of a product. Blockchain solves this problem by keeping unalterable records of the product journey from raw material to finished product, which makes it impossible for fake products to be verified on the network. Decentralized applications for verifying the origin of purchased goods will enable customers to scan the product code and see the product journey.

Blockchain technology prevents accounting fraud

Blockchain technology solves the problem of accounting fraud in supply chains by creating blocks of records that cannot be altered. For example, if Supplier A were to supply through a traditional supply chain, accounting problems may be encountered on both the supplier and the consumer end because information throughout the supply chain can be altered and the middleman could change the amount being supplied, which poses an issue for verification. 

On the other hand, if Supplier A is sending 50 shirts to Consumer B through blockchain technology, the number of shirts and the amount to be paid for the shirts cannot be altered on the network, thereby preventing fraud.

Blockchain supply chains are faster than traditional supply chains

Any fashion supplier knows the importance of delivering new waves of stock faster and more efficiently. Even though transactions on a blockchain can take between 10 minutes and several hours to undergo verifications due to limits on the network’s transaction volume, some new blockchain projects now have improved transaction speeds. 

The speed of a blockchain network can ensure that verifying the authenticity of supplied fashion goods is completed within microseconds of arrival, and with the removal of middlemen from the supply chain, goods can be supplied at a faster rate, improving the efficiency and quality of goods supplied. Fashion products that are returned due to defects can also be processed through a blockchain network without any alteration.

Blockchain brings innovation through decentralized applications

Blockchain is a new technology that optimizes supply chains across a wide range of industries. For example, New Balance now uses the Cardano blockchain to authenticate its shoes, and users can verify information about a pair of sneakers with the data recorded the blockchain; while Provenance, a blockchain supply chain company, operates on open-source software, which encourages developers across the world to contribute to their project. 

Blockchain technology has solved a significant number of industry and technological issues by preventing fraud and hacking, removing middlemen and ensuring that the right goods are supplied to consumers as quickly as possible. Blockchain technology will increase the technological advancement of supply chains in the fashion industry. The future we look forward to in the supply chains of the fashion industry is here.

The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Oluwatobi Joel is a U.S.-based freelance copywriter, community manager, blockchain expert and serial entrepreneur. He has worked with various blockchain startups as a marketing strategist. He is also the co-founder of Lootner, a Bitcoin reward website.


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How blockchain technology improves the speed of supply chains in the fashion industry

VanEck: 4 Reasons Why Bitcoin Improves Investment Portfolio Upside

VanEck: 4 Reasons Why Bitcoin Improves Investment Portfolio Upside

Major U.S. asset manager VanEck lists 4 reasons why Bitcoin improves an investment portfolio

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Major United States investment management firm VanEck has listed four reasons why Bitcoin (BTC) improves an investment portfolio upside.

On Oct. 8, VanEck released research titled “The Investment Case for Bitcoin,” aiming to determine what role the cryptocurrency can play in an investment portfolio. According to VanEck, a firm that attempted to list a Bitcoin-based exchange-traded fund (ETF) with U.S. regulators in 2018, Bitcoin’s combination of “durability, scarcity, privacy, and its nature as a bearer asset all contribute to it holding monetary value.”

1. Monetary value instead of intrinsic value

As VanEck often refers to bitcoin as “digital gold,” the asset manager argues that Bitcoin is a potential store of value. While Bitcoin critics usually point out a major narrative that Bitcoin has no intrinsic value as a primary argument for its failure, VanEck urged to draw a clear distinction between the terms intrinsic value (IV) and monetary value (MV). According to the firm, Bitcoin actually has MV just like gold or silver, artwork or U.S. dollars.

In the full research presentation, VanEck stressed that nothing ever “backs” MV:

“MV is inherently a bet that an object will retain value or increase in value in the future. Items with MV are items that store value and can be seen as claims on future IV. This may make people uncomfortable but it has been true since the dawn of civilization.”

Intrinsic value goods vs monetary value goods. Source: VanEck

Intrinsic value goods vs monetary value goods. Source: VanEck

2. Low correlation to traditional assets

According to VanEck, Bitcoin may also potentially increase portfolio diversification due to low correlation to traditional asset classes such as gold, bonds and broad market equity indices.

To prove the point, the firm provided a table on Bitcoin’s correlation with major market indices such as S&P 500, oil, real estate, measuring the correlation level on a scale from -1 to 1. The firm was analyzed correlation from February 2012 to July 2019.

Correlation of Bitcoin to traditional markets. Source: VanEck

Correlation of Bitcoin to traditional markets. Source: VanEck

3. Scarcity strengthened by halvings

In the report, VanEck also cited Bitcoin’s scarcity or limited supply as a major reason for the asset’s success. Bitcoin halvings, defined as a 50% block reward cut to Bitcoin production rate, are programmed to occur roughly every four years, VanEck explained, noting that each halving event has eventually led to growth of Bitcoin’s price.

The next Bitcoin’s halving is scheduled for May 2020. As such, famous Bitcoin bull and programmer John McAfee recently cited Bitcoin’s scarcity as a primary reason for Bitcoin to hit $1 million per coin in 2020.

Bitcoin halvings and price. Source: VanEck

Bitcoin halvings and price. Source: VanEck

4. Growing adoption

As part of the growing adoption of Bitcoin VanEck cited the fact that Bitcoin transactions exceed 400,000 permissionless transactions a day, while Bitcoin on-chain transactions amount to a notable portion of SWIFT transactions. The firm also noted that existing crypto exchanges are healthy and not going away, citing the position of companies Bitfinex and Binance.

In mid-September, the Chicago Board Options Exchange’s BZX Equity Exchange withdrew its VanEck/SolidX Bitcoin ETF proposal from consideration before the U.S. Securities and Exchange Commission.


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Major U.S. asset manager VanEck lists 4 reasons why Bitcoin improves an investment portfolio

How Blockchain Improves Daily Health Care Routine, Explained

How Blockchain Improves Daily Health Care Routine, Explained

Why do insiders believe that health care is the ultimate use case for blockchain? Learn more about decentralized medical solutions.

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1.

The data stored on a blockchain is transparent and immutable, which is extremely important for the health industry. Some insiders even call it the “ultimate use case” for the technology. 

In fact, there are several reasons behind this hype. As Cointelegraph previously explained, one of the core characteristics of blockchain is its decentralization. Each move is publicly recorded, time-stamped and nearly impossible to edit. The blocks that contain data are protected by advanced cryptography. If the information on the block has somehow been altered, the users of the network (nodes) have to agree on the changes. This technology could be tremendously effective for many public systems — health care, in particular — and here’s why. 

Foremost, the health care industry has to deal with a lot of paperwork, and it processes enormous amounts of data on a daily basis. Blockchain technology allows for significantly reducing the time spent on this routine. It provides a sophisticated tool for managing all sorts of databases — including those concerning patients — as all the information is safely stored in blocks and only an authorized person can have access to it. This means the doctor who deals with the patient can proceed with the data directly, without communicating with other staff or even other health care institutions. In case of an emergency surgery, even a minute saved this way could count. 

Some indeed believe that blockchain could contribute to establishing a shared database of patient data, which, in turn, would connect different hospitals and private practices using drastically different systems. For instance, just in the American city of Boston, there are 26 electronic medical records systems that are not compatible with each other. And the situation is even more desperate at a larger scale. Imagine a woman who faces a premature delivery and is currently a thousand miles away from the state she planned to give birth in and all the therapists who have been familiar with her case. In a situation like this, it would be crucial to have a single, comprehensive database that could be easily accessed by different hospitals within the country. 

Another major problem in health care is the abundance of middlemen who were intended to facilitate the interactions with medical institutions. For instance, the current state of the health care system in the U.S. looks like an incredibly complicated alien microcircuit.

Blockchain offers a major solution for this problem: smart contracts that allow us to interact directly with the person we need. These contracts could be used in telemedicine — a growing field of medicine that allows doctors to reach their patients via smartphones, wearable gadgets and other devices. While this type of interaction is very handy in the modern world, it is still vulnerable to hackers. Smart contracts would help collect the client’s data securely and transparently.

And last but not least, blockchain could really help the health care industry to eliminate counterfeit drugs. One of the areas that uses decentralized technologies the most is supply chains. Some commercial giants are already using blockchain to track the origins of a particular product they sell, and pharmaceutical manufacturers could do the same. According to the World Health Organization, approximately one in 10 medical products circulating in low- and middle-income countries are substandard or even fake. If the whole industry traced the medications via a secure blockchain system that prevents data from being changed, the percentage of fake drugs on the market would significantly decrease.


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Why do insiders believe that health care is the ultimate use case for blockchain? Learn more about decentralized medical solutions.