Blockchain in maritime sector Disruption or incremental innovation. Or both? Dennis Dortland Portbase IPCSA Rome, October 5, 2017

Contens Blockchain: Pizza or pasta? Port processes and perspective Blockchain promises and considerations Recommendations

Blockchain elements Permissioned Proof of stake Public Permissionless Community voting Permissionless Permissioned Proof of stake Proof of work Private Trusted third party Public Mining Anonymous Trusted participants Tokenised

Blockchain elements There are many ingredients to choose from There is no consensus yet on what blockchain is. Are we talking about pizza or pasta?

The Port Perspective Deepsea Port Hinterland Global and local operators have quite a different view Ports have a unique mix of global and local perspectives. Port is focal point for government processes

Market developments Note there is a storing interaction between the Internet of Things and Blockchain

Blockchain developments Integration of logistic and finance processes Local: i.e. inventory finance Global: i.e. B/L & LoC digitization Tracking & tracing Integral planning Reduce or prevent congestion Reduce CO2 emissions Sensing cargo integrity (IoT) Cradle-2-cradle goods information Pilots with customs organisations We’ve all seen the market announcements T&T: For Chain / logistic supervisors to manage flow of goods Cargo condition: reactive and proactive action when conditioning is not adherent to required conditions Cradle2Cradle: counterfeit

Blockchain considerations Promise Consideration No centralized authority needed Futureproof governance needs to be built-in All business processes are connected System integrators or data hubs required to reduce chain connection costs Data standardization required for maximum process improvement Smart contract will handle business logic Core business processes will be handled in core systems Data access only to those permitted Authorisation management is not trivial, sometimes just-in-time Global accepted Identity Management becomes increasingly important Blockchain is robust to attacks Private key security and management will become more important We don’t need to

Blockchain considerations Promise Consideration No centralized authority needed Futureproof governance needs to be built-in All business processes are connected System integrators or data hubs required to reduce chain connection costs Data standardization required for maximum process improvement Smart contract will handle business logic Core business processes will be handled in core systems Data access only to those permitted Authorisation management is not trivial, sometimes just-in-time Global accepted Identity Management becomes increasingly important Blockchain is robust to attacks Private key security and management will become more important Leverage existing trusted networks: PCS Standardized & commoditized port processes Blockchain oracle for basic port processes Gateway for local network and global data sources Bridge different technology adoption levels Act as a neutral intermediary for b2b and b2g Provide a level playing field for logistic businesses

Conclusion & recommendations Blockchain offers many promises, best practices are needed Some applications need external source of trust or governance Blockchain has evolutionary and revolutionary applications Revolutionary blockchain applications require standardization for full impact Ports are pivotal between local and global processes Leverage existing trusted networks for process harmonisation, integration and governance In summary, Blockchain is a combination of several ingredients giving a strong set of capabilities Paradoxally, to be able to implement the “disruptive” aspects applications need to build on incremental improvements, i.e. standardization and trusted networks

Thank you! For questions or comments, please find me at d.dortland@portbase.com Rome, October 5, 2017

Blockchain in maritime sector Disruption or incremental innovation. Or both? Dennis Dortland Portbase IPCSA October 5, 2017