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Managing physical items in cyberspace

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One of the earliest large-scale blockchain use cases was the management of supply chains. The process of managing products from the original producer all the way to the consumer is expensive and time consuming. With today’s product-tracking applications, it can be difficult for consumers to know much about the products they consume. Some products, such as electronics and appliances, may have descriptive tags that identify places and times of manufacture, but most products we consume don’t provide that type of information.

Implementing supply chain management provides multiple benefits. The first is transparency. Producers, consumers, and anyone in-between can see how each product traveled from the place it was manufactured or acquired to where it was finally purchased and the time it took to get there. Inspectors and regulatory auditors can ensure that each participant in the supply chain met required standards.

This increased transparency occurs while eliminating unnecessary middlemen. Each transfer in the process occurs between active participants, not brokers.

Proper tracking of physical products in the blockchain depends on accurately associating the physical product with the digital identifier. For example, I recently checked my bag when I flew on a commercial airline. The agent was busily engaged in a conversation with another agent, and swapped my tags with those of another traveler. His tag was attached to my bag, and vice versa. When I arrived, the airline discovered that my bag, with the other person's tag attached, had flown to Mexico. Always remember that the blockchain only represents the physical world — it isn’t the physical world.

Blockchain Data Analytics For Dummies

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