Aviation is a continuously evolving industry and one of the latest is the Blockchain technology. Though IATA claims that the blockchain can only be incorporated by 2035, but alot of advancements are being seen.
Blockchain has been identified as one of the technologies that might have a major impact on the future of aviation. Even in its infancy it has caught the attention of many industries, because of its properties like decentralisation, scalability and security.
The technology is currently undergoing a phase in which it is evolving itself and the concrete benefits are becoming clearer. However, it is still not very clear on how to utilise its advantages to the fullest.
The first blockchain was utilised by as Satoshi Nakamoto in 2008. Nakamoto used a Hashcash-like method to add blocks to the chain without being verified by individual parties. In the following year Nakamoto applied the technology to the cryptocurrency, Bitcoin. In this case, the technology was used to maintain a database for all the financial transactions for the users.
The words block and chain was used separately in Satoshi Nakamoto’s original paper, but were eventually used as a single word, blockchain, by 2016. This first Blockchain white paper was introduced into aviation by IATA in 2018, to raise awareness on the potential of this technology for the aviation industry and to guide the industry towards the most promising business opportunities, while being mindful of the potential risks and challenges.
What is the Blockchain Technology
So first lets consider how data is stored traditionally. Data is stored in a central infrastructure or a database, with multiple back-ups and redundancy measures. In case of the blockchain, data is stored in a decentralised manner ie stored in multiple locations. Its basically a digital ledger that stores the users data in multiple systems, so that there is better accessibility and security.
So in a traditional data system, if the central infrastructure is destroyed or altered, all the data is affected. Incase of a blockchain, to alter or change the data it has to be changed in all the systems. The property of being decentralised makes blockchain a trustworthy solution to be adopted by multiple industries.
Every record or data are stored in a form known as a block. And blocks are linked to each other cryptographically, ie in chains. Now as these blocks are in chains, no single blocks can be altered without changing the previous ones which adds on to the security. Decentralisation and the cryptographic arrangement makes the technology unbeatable.
Blockchain technology in Aviation
The decentralised feature of Blockchain makes it very attractive for aviation. The shared data record system can be used by multiple divisions like MRO, OEM for storing flight records, maintenance status, spares, aircraft availability, crew management etc. The applications in aviation are endless. Now lets list out a few of them:
- Smart contracts
A smart contract, also called crypto-contract , is a computer program that directly controls the transfer of digital currencies or assets between parties under certain conditions. Now, commercial aviation involves various entities like airlines, passengers, caterer, ground handler, aircraft manufacturers, travel agents etc. The financial transactions can be traced and secured through procure-to-pay using smart contracts, all streamlined by Blockchain.
We already see tokenisation in frequent flyer miles, refund coupons, gift coupons etc. But the re-use or mis-use of these miles or digital currency can be prevented by the blockchain, as there is a history or record of how its been used. For example airlines have digitalised their upgrade coupons from paper coupons to prevent fraud and reuse.
With the blockchain, accountability has come into play. Now the tracking of the status and location of cargo, baggage, spares and even the aircraft is being made simple and secure with the help of the chain. Blockchain technology offers a simple and easy way to record events in a way that is tamper-proof.
The certification process of crew, engineers, employees, equipment and aircraft can be streamlined and simplified with the technology. The records also can be maintained safe and secure without any tampering allowed.
5. Digital Identity
Today, 95% of the business happens in the digital space. Companies want to publicise and advertise their products and services. but at the same time, they want to know who they are doing business with. The companies want to be aware of all the risks as well as possibilities while doing business with an entity. The inherent security properties of the Blockchain technology make it very suitable as the underlying technology for digital identity management solutions.
The applications of Blockchain technology are endless. Though it will take some time to mine the full potential of this technology. But I firmly believe its the future of aviation. Singapore airlines and the KLM are already in process of testing this technology. Even Boeing has filed a patent in Blockchain-based anti-spoofing GPS system. Finally I would say, blockchain if and when it comes, can make a huge difference in aviation.
Thank-you for reading.
If you need any clarifications please contact us