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How Blockchain Can Change the Dynamics of the Supply Chain

Blockchain has become a new standard in the supply chain since supply chains are intertwined with third parties; this disruptive technology is the primary key to resolving third parties issues in the supply chain. Websites like bitcoin trader provide a trading platform that permits you to begin digital currency trading in three steps. However, numerous factors, such as currency, legal jurisdictional differences, and a lack of trust across borders, create an environment fraught with risk. 

Blockchain also allows international funds to originate from their respective home currencies. When it comes to the developing world where counterfeit issues are rampant, and government corruption is rampant. Blockchain embedded in the supply chain turns it into a much more classified chain where every player is on common ground. 

As in the supply chain, numerous processes are going on; blockchain can help track each. Furthermore, blockchain can remove hefty fees associated with international funds transfers and provide the flexibility of higher returns on investment through cryptocurrency investments that may be used in digital finance or fiat currency trading. International trades are more straightforward with blockchain. Blockchain is becoming the key to success in managing the supply chain. 

The Changing Face of International Trade

International trade is an essential aspect of supply chain management as only some supply chain members are from a similar nation. International funds transfer services were established to facilitate international transactions for large-value assets and international payments for small transactions such as money orders. The scope of international funds transfer service offerings has expanded to include international wire transfers, credit cards, international debit cards, and prepaid gift cards. International payment methods are entangled with third parties, which further increases the transaction fees, but blockchain can correspondingly reduce the international transaction fees in the supply chain. 

Blockchain, as a technology in the supply chain industry, can bring many positive changes. Usually, the members of the supply chain utilize traditional payment methods. However, despite this growth in available services, there are still thousands of dollars worth of fees involved in these transactions that significantly impact the cost and ease of making an international purchase. In addition, they also facilitate the ability of customers to purchase goods from foreign companies using a different currency than their home currency. 

In the traditional international money transfer system, the money has to pass through the jurisdiction of both countries, which correspondingly consumes a lot of time. Moreover, when a customer makes an international purchase, they are forced to convert their domestic currency into one accepted by the foreign entity before completing the transaction. It can be done through either a bank or non-bank service provider. Worse, these fees can be substantial and grow as large as 1000% in some instances. Moreover, the instances of a chargeback in the international transaction worsen these traditions. 

Blockchain makes a difference:

Product visibility and reduction of intermediator costs are highly mandatory in the supply chain. Blockchain technology can significantly reduce these international funds transfer fees and processes by providing a decentralized platform for individuals to transact with one another. Blockchain allows large-scale participation in international trades without being subject to fees or the red tape associated with cross-border payments. Blockchain has given birth to many more opportunities for supply chain management as now participants or members of the supply chain can have better interaction with each other. 

Blockchain proponents believe it can create a new way of doing business as its decentralized architecture creates a trustless environment where all transactions are transparent and traceable.

Blockchain is transparent:

The limpidity of blockchain is highly beneficial for the supply chain. Blockchain allows for the secure transfer of transparent funds to both parties. Not only does blockchain allow for direct peer-to-peer transfers, but it also allows for immediate payment of services such as music streaming and media downloads without the delay of the confirmation period. The more transparent a blockchain is, the more it can help the supply chain members by increasing product visibility.  

Undeniably transparency in the supply chain is a challenge to achieve. Still, with the assistance of this technology, every piece of information regarding the life cycle of a product will be onboard. Blockchain is also much more convenient than other international funds transfer services because it reduces significant processing times and removes government bureaucracy from any international trade transaction. 

Fundamentally, blockchain allows for international trades to be completed in real-time instead of waiting hours or days for the payment to be processed by various banks involved in an international trade transaction. The international trade occurrence in the supply chain is widespread. With blockchain making international trades easy, supply chain members can gain advantages such as reduced cost of conducting a global transaction. 

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