ShipChain ICO review! The SHIP token uses blockchain technology for supply chains, transportation, & logistics. Here's what you need to know about ShipChain & the SHIP coin.
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Number 8: What is Shipchain?
ShipChain is a platform using blockchain technology aimed at disrupting transportation and logistics by making their processes more secure, effective, and transparent. The entire supply chain will integrate with ShipChain, from the moment a shipment exits the factory, farm or field, until the delivery is completed on the customer’s doorstep. The entire process will be done through smart contracts created on the Ethereum network.
Number 7: Why was ShipChain Created?
ShipChain was created as a solution to several major problems the logistics industry is currently facing. The team behind the project recognizes that the world’s economy is impacted by the movement of goods in a major way. As one of the largest industries on the planet, its 2015 market global value was estimated at $8.1 trillion, accounting for 55 billion tons of freight. The ShipChain team believes that if the industry continues to progress on the same trajectory, these figures will most likely double by 2024. In the United States alone, freight and logistics accounted for roughly 10% of the country’s GDP in 2015. ShipChain is shaped as an efficient alternative to major bottlenecks in the supply chain.
Number 6: What are the problems with current logistics?
There are a series of problems the team has outlined in ShipChain’s whitepaper. Bad tracking is one of them because for end-users, a shipping experience can be negatively impacted by fractured tracking without regular and reliable updates. This can lead to confusion among carriers, failed deliveries, and even lost shipments. Lack of transparency is another issue they’ve identified, and this comes as a consequence of bad data handling, which can confuse brokers to the point that they don’t know which carrier and driver is carrying the freight. The annual cargo theft loss estimated by the United States FBI was placed at over $30 billion in 2016. This figure is set to increase in the future, as lack of transparency—combined with bad tracking—can lead to a lack of accountability. Brokers will often withhold information regarding who's moving the cargo, and fragmentation among carriers causes uncertainty regarding the location of cargo at a particular time. A lot of errors in freight are produced by hand-offs and oftentimes, neither side will take responsibility if a container doesn’t get from the ship to the truck. Middlemen in the industry such as brokers and forwarders, which in some cases will charge between 30-50% for their services, carry much of the blame for these problems. Despite their claims of making freight easier to ship and manage, most of the times they're high maintenance; thus increasing freight costs and decreasing pay for shippers. ShipChain summarizes these issues as a natural result of misaligned incentives that lead to dishonesty. By providing poor tracking, carriers get to maintain their deniability if freight is damaged or lost. Since brokers need to protect their exclusive relationships, being honest about the whereabouts of cargo doesn’t allow them to shift blame.
Number 5: What solution does ShipChain provide?
Using a ShipChain sidechain, the platform aims at unifying shipment tracking across the Ethereum blockchain. Geographic waypoints across each smart contract will be encrypted, with access being granted only to the parties involved. This will not only allow carriers to communicate with ease, but it will also give shippers more visibility across the supply chain. The sidechain will record and publicly validate information regarding waypoints, loads, and basic compliance information. ShipChain also plans on offering decentralized brokerage by enabling carriers to find shipments and route transportation based on factors like fuel use, weather conditions, traffic, distance, and more. The system will generate a smart contract upon pickup and hold payments in escrow until the release conditions are met. The sidechain and main blockchain will track the cargo and monitor its security. Through the use of blockchain technology, the security of assets will also be increased, and every step of the shipping process is accounted for. Every time electronic logs are reported, assets are automatically verified using barcodes or hardware RFID integration (or radio-frequency identification). No one will have the ability to change or delete existing data. The platform operates on a trustless concept, as the arrival of particular shipments can be verified through digital escrows that have the encrypted waypoint information and data about the loads. Conflicting stories about the whereabouts of certain goods are thus taken out of the equation. Another one of ShipChain’s objectives is to unify management in an open ecosystem that connects shippers to carriers, and to provide smart contracts that other platforms can build upon to solve shipping issues. It will also provide the first app for cargo booking: shippers will be able to log on and place their order using shipping and routing methods based on contents, cost, and time in transit.
Number 4: How does ShipChain work?
The operating concept behind ShipChain is fairly easy to understand. The Ethereum Virtual Machine powers ShipChain's Contracts, which can be duplicated and used to create a shipping escrow on the distributed ledger. The ShipChain Protocol is a fork of the Ethereum software, and will feature side-chains, such as the one implemented by the ShipChain Foundation, called ShipChain Prime. Side-chains can store and verify load data and individual tracking waypoints. Large partners will be able to have their own side-chains and operate them using the ShipChain Protocol. The smart contract is initiated when a shipment order is placed. It will include a hash sum signature of the shipment and all the information surrounding it (like the beginning address, delivery point, number of items, weight, etc.). This data can be verified by people with a copy of these values on the main Ethereum blockchain. It can additionally be encrypted and stored in a side-chain for more detailed tracking. The contract will be completed on delivery once all waypoints and validations are affirmed. If carrier partners want to, they can take data from ShipChain’s tracking system and post it to their websites and systems for broader use, thus contributing to a more unified tracking system. Not only will ShipChain allow open access to its blockchain marketplace, but it will also build the first platform of services on it. It will be called the ShipChain Web Platform, a centralized system for booking and managing freight shipments that will incorporate many types of carriers and forms of transportation. The team provides an example of how the platform works in the project’s whitepaper. If a shipper has five containers of shoes making their way from China to the US for example, the system will optimize the modes of transportation for speed and cost based on the type of shipment; in this example, the routes may be sea carrier to rail carrier and finally to truck carrier. One thing to note is that in order to comply with regulations, ShipChain may require licenses in freight brokerage, freight forwarding, and have an internal customs brokerage. This means that even though shippers can book their own routes, ShipChain may need to be the official booking agent for freight in order to comply with regulations.
Number 3: What is ShipChain’s Token?
You’ll need to own at least one SHIP token in order to get “ShipChain Membership Status,” which essentially grants you access to the blockchain for the purpose of booking freight or tracking shipments. Transactions concerning shipments are paid for and settled in SHIP tokens. Users will be able to pay directly through the tokens they already hold, or they’ll be able to purchase the tokens they need from ShipChain using Euros, USD, or other fiat currencies as well as cryptocurrencies. ShipChain will allow for ease in liquidity and settlement of SHIP tokens into other currencies by entering into listing agreements with exchanges.
Number 2: Who is behind ShipChain?
John Monarch will be captaining the project as its CEO. He’s also the founder and CEO of Direct Outbound, one of the largest fulfillment & third-party logistics companies in the Southeast United States, and also one of Shipchain’s main partners. For 11 years, Lee Bailey has been a full-stack developer, blockchain consultant, and entrepreneur, and he'll be serving as ShipChain’s Chief Technical Officer. Chris Perdue, a 4th generation family owner and spokesperson for Perdue Farms, is one of the project’s advisors while Perdue Farms counts itself as another one of ShipChain’s partners. Other partners include media outlet Influencive, BiTA (short for Blockchain in Trucking Alliance), Sweetbridge, & The Crypto Valley Association.
Number 1: What's next on ShipChain’s Roadmap?
In accordance with the upcoming Electronic Logging Device mandate from the US Department of Transportation, the team will work with ELD developers in order to achieve its first goal of completing ShipChain’s Track & Trace technology. If you’re not familiar with the now congressionally-mandated ELD, just think of it as a device that will synchronize with a commercial vehicle’s engine to automatically record driving time and other data. By working with these developers, ShipChain will be able to immediately integrate into the largest network of trucking freight companies in the US. This is just an initial step as in time, ShipChain will also be able to use its multimodal blockchain-based tracking system to integrate with major US railroads, major airlines, and global ocean freight providers. It’s fairly early to tell if ShipChain will truly revolutionize logistics and transport, but there has been a high degree of public interest in the project. With ERC20 SHIP tokens pegged at $0.34, the team managed to raise $30 million during their January 2018 presale. An airdrop was announced for January 14th, with the airdropped tokens, along with the presale tokens, released in early March of 2018.
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