We have the technology to deliver superior logistics, but it needs some assembling. In this final topic tutorial of The Bitcoin Masterclasses #5 Day 2, Dr. Craig S. Wright talks about EDI (electronic data interchange) standards, how they evolved, and how Bitcoin can evolve it further. We do need developers to build the applications everyone will use, but the good news is that Bitcoin automatically creates universal standards.
Dr. Wright begins by describing EDI data formats, giving the example of Bills of Lading in shipping. While they have identifying numbers, they’re not always unique. But there’s no reason you couldn’t use a Bitcoin UTXO (transaction ID number) as a standard for that. Bitcoin keys can serve as unique identifiers for buyers and sellers, proving that information exchange has occurred between two parties without (publicly) revealing any confidential information. Transactions can involve multiple parties and approvals.
Any other relevant information can be included, like special considerations, hazardous goods markers, weights, etc. Conditions can be set to ensure standards are all met. All this information can be shared and signed by anyone in the shipping chain, even if they don’t have any direct business relationships with each other.
Code is not law, but it makes human rules easier to follow
Things don’t go smoothly 100% of the time, so other steps can be built into an automated process to deal with mistakes and other contingencies, like escrow and methods for dispute mediation. Dr. Wright points out that this is far from the “code is law” myth promoted by others in the blockchain world—it’s people who build these systems and people who must first agree on the rules before the process begins (see the “master contract” concept from the first session of this Masterclass series).
“We’ve got our inputs. We can tie these to keys. We can specify using X509 a whole lot of conditions.” Where’s the best place to solve the “garbage in, garbage out” (GIGO) problem in automated systems? Right at the source or the beginning.
Universal standards minimize mistakes and fraud. They also allow computers to handle most input processes, reducing human error. Authorizations can be revoked if a security breach occurs and all parties notified in seconds, not days.
“This is the power of decentralization in the true sense,” he says.
Bills of lading, bills of exchange, purchase orders, credit letters, invoices, trade financing documents—all these things are (or can be) standardized. All these documents can be tokenized as NFTs, can be traded, and are worth money—that is, in the business-efficiency sense and not in the speculative sense. And don’t forget that Bitcoin is fundamentally a digital payments network, so payments of any size can be approved and sent anywhere in the world almost instantly.
Humans create the standards, and blockchain delivers the efficiency
For physical items, there are cheap sensors and cameras to measure anything that can be measured. BSV provides a fast, secure, and scalable blockchain network to record and store every piece of information gathered.
More information means more efficiency, but there was a trade-off in the past: gathering all that information would’ve been an efficiency drag. A scalable blockchain and cheap IoT devices remove that drag. Automated data processes and consistent standards reduce human error.
The human and physical worlds are not perfect, and there are always variables and unexpected situations (whether they’re “known unknowns” or “unknown unknowns”). The more information we have on what’s happening, and the faster that information can reach everyone, the easier it is to deal with problems.
Watch: The Bitcoin Masterclasses Workshop on Ideas for implementing Bitcoin blockchain in businesses
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.