Blockchain technology is catching on in an area that is a far cry from FinTech. According to a recent report from Accenture, more than 85% of aerospace and defense companies are expecting to use blockchain in their businesses by 2021. Aviation may not seem like a natural fit for DLT, but it offers some advantages for an industry that needs to keep strict records for safety reasons.
John Schmidt, who is Accenture’s managing director of aerospace and defense, told Aviation Week that, “It’s very rare that we talk about something two years in a row but this technology is taking off much faster than we thought it would,” and that, “Another interesting industry statistic is the number of companies already working with blockchain – not necessarily having a system installed but working with the concept. More than half of them are working with the technology today.”
Private blockchains are a great new tool for businesses that need to make sure their records are secure, and precise. Unlike blockchains that use proof-of-work to validate transactions, private blockchains are operated via a server or network that doesn’t rely on mining to incentivize the blockchain’s operation.
The Aviation Industry Sees Real Potential in Blockchain
Some have compared private blockchain technology to a regular shared database, but the inability to alter blocks once they are created is a new benefit that fits into the aviation industry perfectly. Mr. Schmidt expanded on this aspect of blockchain technology, “It (blockchain) also helps us be in a better position to create the feedback loop from what we’re seeing in the asset, its life and its usage to put back into engineering,” and that, “This can then be used to enable changes to better improve the asset’s life.”
Aircraft maintenance is a vital part of making sure that planes are safe to operate, and blockchain-based records could help airlines make sure there weren’t any oversights that are potentially dangerous. Blockchain can be used to track everything that happens to major parts of an aircraft, like the engine, so that any problems have a better chance of being detected.
Earlier this week Accenture confirmed they would be working with Thales at Farnborough to create a blockchain platform to establish more confidence in supply chains. They plan to use blockchain in order to create a secure record of every part that is used in an aircraft’s construction. Any issues would be easier to track down, across the entire indutry. This is more or less the same idea that the IBM Food Trust operates under, which illustrates the utility of blockchain’s capabilities in numerous vital industries.
Ready to Launch
Gazpromneft-Aero, who operates of the Gazprom Neft aviation refueling business is working with S7 Airlines and Siberia Airlines to use a blockchain-based smart-contract system for aviation fuel payments. The group calls the new kind of contract Aviation Fuel Smart Contracts, or just AFSCs for short.
The Deputy CEO for Logistics, Refining and Sales at Gazprom Neft, Anatoly Cherner, thinks that, “The development and implementation of digital services like this is an important element in creating a digital platform for managing the logistics, processing and sale of oil products at Gazprom Neft. Implementing digital transformation projects in cooperation with major partners will enable the company to reach a new level in technological and operational efficiency, right now,” according to a statement released after the program was announced.
When AFSCs were announced they were the first commercial use of blockchain technology in the Russian market, and have helped the participants cut down on all the hassles connected with the airline fuel payment system. Blockchain appears to be a better system for numerous applications, which offers significant improvements over existing database technologies. The aviation industry is another early adopter of a technology that appears to bring numerous advantages to the table.