Blockchain Use in Foreign Trade

[vc_row css=”.vc_custom_1629803910077{margin-bottom: 24px !important;}”][vc_column][vc_column_text]Blockchain technology, which is often mentioned with cryptocurrencies because it is in the background of cryptocurrency networks, provides convenience in foreign trade. Blockchain, which works with the method of keeping records in blocks that work by connecting to each other, works with a reliable and transparent technological infrastructure that allows encrypted records. For this reason, Blockchain, which is very popular in today’s financial world, is extremely popular in all sectors related to finance. Blockchain, which provides global transaction tracking and makes business tracking reliable, ensures the accuracy, transparency and traceability of transactions. For this reason, blockchain, which is a management system with a transparent and global database feature, has an important potential in foreign trade due to its high security features.[/vc_column_text][/vc_column][/vc_row][vc_row css=”.vc_custom_1629803910077{margin-bottom: 24px !important;}”][vc_column]

The Role and Reliability of Blockchain in Foreign Trade

[vc_column_text]Imagine a giant ledger of records, and blockchain is the digital version of that ledger. But it is much more than that. It is estimated that by using blockchain technology, more than 1 trillion dollars in cost savings can be achieved annually in global foreign trade transactions. Blockchain technology is a technology whose potential use in foreign trade is developing and its use is increasing rapidly. Perhaps the most important feature of this technology is that it offers an encrypted and unalterable network of records that can be seen and verified by all participants in this decentralized distributed ledger network. This makes blockchain technology a reliable system for foreign trade.

Blockchain offers a renewable and frequently updated system, but only for forward-looking records. Every step of a foreign trade transaction can be recorded. However, these records cannot be changed retrospectively. Therefore, this digital ledger with its transparency feature is constantly updated and verified by all participants in the network. Because it is not tied to a centralized system or company and cannot be retroactively altered or falsified, a blockchain-based foreign trade system is a trusted source for every interlocutor and provides a transparent, renewable and reliable record of transactions. A suspicious transaction has no place in this system as it can be quickly detected. Thanks to these qualities of blockchain technology, the terms of agreements between the parties, payment transactions and delivery of goods can be recorded in a completely transparent manner. Another reason for this transparency is that blockchain networks operate without the need for any central authority or intermediary. Therefore, in blockchain-based foreign trade transactions, trust between the parties increases and there is no doubt about the accuracy and integrity of the transactions. With this feature, blockchain contributes to the consolidation of trust in foreign trade relations.

In addition to trust, error-free (free from human error) documentation and speed are also critical factors affecting foreign trade relations. In blockchain technology, foreign trade transactions can be carried out quickly, which means time and cost savings. In other words, thanks to blockchain, which is a transparent and reliable system, blockchain-based transactions in foreign trade, document and information sharing between parties can be carried out effectively, easily, quickly and less costly.

Due to all these qualities, the use of blockchain in foreign trade has increased rapidly in recent years in the digitalized global business world. Experts predict that this rise in foreign trade will continue in the near future.[/vc_column_text][/vc_column][/vc_row][vc_row css=”.vc_custom_1629803910077{margin-bottom: 24px !important;}”][vc_column]

Uses of Blockchain in Foreign Trade

[vc_column_text]Blockchain technology, where blocks are connected to each other, can be used by companies in many areas of foreign trade.

Data Sharing: This technology facilitates data sharing between all parties in the supply chain and provides real-time information about the origin, status and location of products.

Supply Chain: Many companies are using blockchain technology to manage their supply chains around the world. This makes it possible to track the sources of their products. Global giants such as IBM, Walmart and Nestle utilize blockchain in their supply chain.

Logistics Management: This technology can be used for reasons such as ensuring the reliability of goods and reducing food safety risks. For example, Maersk, the world’s largest container shipping company, uses blockchain technology to optimize its foreign trade processes. By using blockchain technology, Maersk facilitates document sharing between all parties in the shipping process and makes the shipping process more transparent.

Supply Chain Management: Blockchain can provide many benefits in the supply chain management process. Thanks to blockchain technology, it is possible to track products throughout the supply chain, perform quality checks and keep a record for each transaction in the supply chain.

Customs Transactions: Blockchain can also be used in customs procedures. By speeding up the flow of documents in import and export transactions, blockchain technology can reduce delays in cross-border transactions.

Payments: Blockchain technology can also be used in payment transactions in foreign trade. By speeding up transactions between banks, blockchain technology can reduce delays in payment processes.

Traceability Control: Blockchain technology increases the traceability of products in foreign trade. Information such as where the products were produced, on which date they were produced, on which date they were exported to which country can be recorded in the blockchain.

Security, Anti-counterfeiting, Licensing and Certification: Blockchain technology can also be used to prevent counterfeiting in foreign trade. Thanks to blockchain technology, the authenticity and ownership of products can be checked, thus preventing counterfeit products from entering foreign trade. It can also be used for licensing and certification in foreign trade. All certificates for products can be recorded using blockchain technology, providing greater confidence in the authenticity of products.

Smart contracts: Blockchain technology uses smart contracts to automatically enforce contracts between parties. This makes it possible to automatically execute the documents, permissions and payments required to complete transactions. This contributes to the automatic systematization of contract documents.

Insurance transactions: Blockchain technology can be used for insurance transactions in foreign trade. By recording all transactions on the blockchain, insurance companies can track insurance transactions faster and more accurately.

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The Future of Blockchain in Foreign Trade

[vc_column_text]Blockchain technology is becoming increasingly widespread around the world. Companies in different sectors want to increase efficiency, reduce costs and ensure reliability by using blockchain. Many countries are working to promote and implement the use of blockchain. The US government is working to create a federal blockchain strategy and fund blockchain research and development activities. In Singapore, experts are working on a special project to make the country’s foreign trade transactions secure and fast using blockchain technology. In China, a special security system is being used to prevent counterfeiting in the country’s foreign trade using blockchain technology. Likewise, in the European Union, work is underway to support blockchain and expand its use. In addition to these, many large companies around the world are using blockchain technology in foreign trade processes, and it seems inevitable that these companies will increase in the coming periods depending on developments.

While blockchain technology facilitates data sharing in supply chains, making processes more transparent, secure and efficient, it undoubtedly positively affects commercial relations. This is an element that positively serves the ultimate goal of organizations – their corporate reputation. For this reason, it is also possible to see blockchain as an investment in corporate reputation. Although blockchain technology is not yet widely used in all sectors, experts’ statements indicate that research, development and applications related to this technology are increasing rapidly and that blockchain technology is expected to be used much more widely in the future.[/vc_column_text][/vc_column][/vc_row]