With blockchain, manufacturing-intensive industries can give rise to planetary ecosystems for sourcing, designing, and building physical goods, marking a new phase of peer production. Combined with other new technologies such as three-dimensional printing, manufacturing will move closer to the user, bringing new life to mass customization. Soon, data and rights holders can store information about any substance from human cells to powered aluminum on the blockchain, in turn opening up the limits of corporate manufacturing.
This technology is also a powerful monitor of the provenance of goods and their movement throughout a supply network. Indeed, manufacturers and other consumers of raw materials struggle with $300 billion/year in global supply chain fraud and leakage. Tracking assets on a blockchain would reduce counterfeit goods and materials on the market, make fraud more difficult and streamline border crossings. Consider that over one billion dollars/day passes across the US-Canada border. As the World Economic Forum has estimated, even a 50% reduction in supply chain barriers at global borders could increase global GDP six times more than the elimination of all tariffs around the world – a huge opportunity for businesses and governments alike.
A look at the flow of goods in manufacturing leads to insight into how profound the implications are for the blockchain revolution. A contract is said to be a meeting of the minds. Blockchains are already being used to create smart contracts in manufacturing because they’re becoming meeting places for digital relationships. These relationships are not just for supply chain management, but at the same time for trade financiers, certification organizations, and customs agents.
Blockchains are allowing for the coupling of the flow of goods and money. Some of the motivation for this coupling is deep tier financing. Here, the visibility and transparency in a supply chain extends through the manufacturing process from the financiers to the consumers. Visibility established through a blockchain is drawing financing to satisfy ethical consumption habits. Among other things this means financing activated in the fight against sweat shops, slavers, counterfeiters, or fraudsters. However when it comes to making this happen there are more questions than answers.