Supply chain is widely considered a major application area of blockchain technology. The demise of TradeLens, a blockchain supply chain network set up by Maersk and IBM, is therefore a major event that will cause re-thinking and re-evaluation of how to successfully deploy blockchain based services. TradeLens had processed over 35 million documents and served over 70 million container movements, but was announced commercially non-viable by Maersk. TradeLens will continue to work until the first quarter of 2023.
Maersk, in an official statement, cited lack of “global industry collaboration”. TradeLens includes over 150 companies related to shipping and logistics, including port operators and other network players. It had also succeeded in onboarding two other major shipping players, CMA CGM and Mediterranean Shipping Company (MSC) in 2019. But MSC also set up its own electronic bill of lading service by collaborating with blockchain firm, WaveBL.
On Twitter, critics and those who love failures took it up against blockchain.
This Maersk TradeLens project was widely heralded as the biggest “blockchain” success story. And in reality it was an abysmal failure. The emperor has no clothes.https://t.co/iTJ8VbEZSt
— Stephen Diehl (@smdiehl) November 30, 2022
TradeLens was launched in August 2018, when cryptocurrencies were riding a wave of bullish sentiments. The aim was to make international supply chains more efficient using the transparent, immutable and hard to tamper blockchain infrastructure. It could be used to track and process data from supply chains for every shipment real time. On one singular platform, all participants could share information, and tracking and tracing of items and suppliers was easy. As reported, IBM data showed users were saving around 20% of documentation costs, and time to ship was reduced by 40%.
“TradeLens was founded on the bold vision to make a leap in global supply chain digitization as an open and neutral industry platform,” said a statement from Maersk announcing the shutdown.
On Twitter and LinkedIn, the reasons for the unviable position of TradeLens can be discerned, mostly pointing to unwillingness to share confidential or proprietary data by networked companies. As per reports, digitization is also yet to catch up in the shipping and logistics industry, and is estimated to be around just 2%.
Maersk is a global logistics service provider based in Denmark. TradeLens was jointly developed by IBM and GTD Solution, a division of Maersk. A.P. Moller – Maersk operates in 130 countries, and employs more than 100,000 people.
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