Stephen Collie Enterprises New Zealand

When we think about industries set for disruption by blockchain, construction probably isn’t top of the list. After all, the traditional image of a building site seems far removed from crypto, coding, and hackathons. But there are potentially enormous benefits for putting blockchain and construction together.

This article will round up some of the possible use cases for blockchain in the construction industry.

Blockchain and Construction Supply Chains

A bad workman blames his tools, right? Maybe that’s a bit harsh, though. After all, the construction industry is dependent on the availability of quality supplies and tools, at the right time and in the right place. Given that the sector is highly fragmented with many different players, big and small, supply chains are a big deal.

Tools for Building

Purchase orders, delivery notes, and invoices are often still paper-based. Firms frequently don’t know if the supplies they need are in stock when they start a project, which leads to delays and incurs costs.

These aren’t even the worst consequences. UK government contract Carillion collapsed at the start of 2018, affecting the jobs of around 43,000 people as a result. Sources pointed to its poor supply chain management as being a critical factor in the collapse, through lousy credit management and a lack of visibility over projects and required supplies.

The blockchain is already proving its ability to transform supply chains, in one instance through the partnership between Walmart and IBM. Using blockchain to manage construction supply chains could create a single source of truth regarding the availability and provenance of construction supplies, as well as tracking payments.

The industry is taking notice of this use case for blockchain and construction. Recent announcements have now confirmed that Probuild, one of Australia’s largest building firms, has partnered with US blockchain construction innovator Brickschain for managing its global supply chain. The announcement confirms that “Probuild has the vision that Blockchain, IoT and Big Data can revolutionize the construction supply chain.”

The Brickchain Homepage

Blockchain and Construction Project Management

Construction projects rely on various parties to work together to complete a building based on pre-defined specifications. Each party expects payment based on work done. Therefore, the peer-to-peer connectivity of blockchain, combined with smart contract functionality, brings excellent opportunities to streamline construction project management.

One study into the potential of blockchain in construction project management found that “[o]n the construction site blockchain can improve the reliability and trustworthiness of construction logbooks, works performed and material quantities recorded.”

Industry publication Construction Manager (they don’t mess around with fluffy, ambiguous names in this business) also reported on the development of two prototype applications combining blockchain and construction.

TraderTransferTrust is a payment system built on blockchain that triggers payment only on the completion of work done. Physical proof of work, if you will. ConstructCoin is another project from the same development team. It aims to create a marketplace of information about the construction industry.

Reduce Litigation

The Construction Blockchain Consortium (CBC) is an industry group set up by its members to investigate the potential for how blockchain and construction could play together. While the above use cases are transformational, the CBC outlines some cultural shifts that may occur in the industry as a result of using blockchain.

The building industry has become highly litigious. The CBC highlights how using blockchain to foster a culture of collaboration and ownership could help to reduce incidences of parties suing one another for shoddy work or delays in project completion. Further, the consortium believes that a less litigious environment “should encourage a less ‘defensive’ approach to decision making and thereby encourage innovation.”

Digitized Land Acquisition and Building Rights

In their paper about the future of smart cities, McKinsey points to the current bureaucracy involved in land acquisition and building rights as a barrier to agile construction. The paper goes on to explain how digitized solutions will speed up the process of obtaining land and building approvals.

Blockchain-based land registries provide a vast improvement over today’s paper-laden processes. Blockchain allows for speedier approvals with no loss of paperwork or waiting for multi-party signatures on physical documents.

Additionally, in countries, land disputes are all too common. A permanent, unalterable record of ownership has distinct advantages in proving ownership. India is among the countries that have been trialing the use of blockchain in land registrations.

Building Inspections

Most buildings are subject to inspections at some point or another. Structures used by the public need checks to ensure adherence to safety standards. Building surveys often feature in sales of real estate, as they reveal any structural faults that may impact the valuation.

These inspections are often conducted in a fragmented way. An inspector or surveyor may have limited or no visibility of records from previous checks. This makes the process heavily dependent on the specific inspector, and errors or oversights may happen.

Building Inspection

Blockchain offers the opportunity for a piece of real estate to come with its own permanent record of past inspections. Blockchain data is immune to tampering by any party who may have an interest in ensuring structure passes muster. Similarly, blockchain could also record any structural or maintenance work undertaken on the property over its life cycle.

More Agile Planning

Currently, there is a lengthy process to procure public funds for investment in infrastructure. Governments must justify the need to spend taxpayer funds on a particular initiative. This means that new infrastructure investment can take months or even years to come to fruition.

As we move towards the smart cities of the future, increased connectivity and availability of information could significantly speed approvals for new infrastructure investment. For example, a government body may quickly build a case showing increased traffic flows in a particular area, using sensor data from a blockchain. This enables faster construction investment in road improvements, traffic calming measures or other means.

Hong Kong

Final Word

Blockchain and construction may seem unlikely partners at first. However, like so many other sectors, construction depends on trust-based interactions with other parties along with solid record keeping. Therefore, assuming the industry can adapt, blockchain could provide significant value to the builders of the future.


This article by Sarah Rothrie was previously published on Coincentral.com

About the Author:

Sarah ran away from a corporate job so she could travel the world. After doing that, she found herself a much-loved new career as a freelance blockchain technology writer. She is now a full-time digital nomad, who travels the world while working on her laptop. In addition to writing and researching, she also runs her own websites – find out more at sarahrothrie.com. You can usually locate her somewhere near the food.

All public blockchains make use of blockchain confirmations. These are important since they can help you understand how confident you can be when making a transaction. When any transaction is first broadcast to the blockchain it starts with zero confirmations. This number then increases as the information is added to the first block, confirmed, given a permanent place, and followed by more blocks.

Blockchain confirmations are vital since they are a way of verifying and legitimizing information that will then become immutable. If a transaction is deemed fraudulent, it will be rejected from the blockchain: zero blockchain confirmations means zero transactions.

On average, cryptocurrency exchanges require a minimum of three confirmations until a transaction is accepted. Coinbase, for example, does not consider a Bitcoin transaction as final until it has received at least three confirmations.

However, the larger the transaction, the more blockchain confirmations are required. This is because the more confirmations there are, the harder the transaction is to reverse. For a transaction of $1 million, it’s not uncommon to wait for at least 60 confirmations. The amount of blockchain confirmations required to verify a transaction varies by blockchain. Let’s take a look at Bitcoin and Ethereum here.

Bitcoin Confirmations

You probably already know that Bitcoin’s blockchain creates a new block about every 10 minutes through the mining process. This block then verifies and records new transactions and appends them to the Bitcoin blockchain. This means that a transaction is unconfirmed until the new block is generated. Therefore, if you’re sending or receiving Bitcoin, it’s essential to wait until you see that the transaction has been confirmed.

One confirmation usually takes up to 10 minutes. But, since one confirmation is not enough to be confident about the validity of the transaction, users have to wait for each new block to be created and verify the information. Depending on the amount being sent, this may take anywhere between 30 to 600 minutes. Ten hours is a long time to wait for a transaction confirmation!

Some Bitcoin services are instant and require only the first confirmation, however, the majority ask for more, with some companies requiring at least six Bitcoin blockchain confirmations before accepting the transaction.

Bitcoin Confirmations

What Is the Bitcoin Mempool?

The Bitcoin mempool is the sea of unconfirmed Bitcoin transactions on the Bitcoin network. As explained above, once a transaction is uploaded to the blockchain, it is not confirmed immediately but is released into the mempool of transactions, which are considered in-motion.

All nodes on the Bitcoin network are connected to the mempool, and that includes the miners who collate transactions from the mempool into a block. The miner who first solves the mathematical equation and adds the block to the blockchain is the first to confirm the block. Therefore, the first to receive the miner reward of 12.5 BTC.

This is fairly straightforward, however, some transactions are picked out of the mempool faster than others. Why? Because miners also earn a bonus percentage of transaction fees (called the Bitcoin mining fee).

Miners will pick out the transactions with the higher fees first to earn a higher bonus. It also explains why not paying transaction fees can lead to your transaction getting stuck. In fact, as more people join the Bitcoin network, this bottleneck is one of the greatest challenges to the Bitcoin community.

How to Speed Up Blockchain Confirmation Times

The higher the fee you pay, the more likely your transaction will be confirmed in a timely manner (there is a 60 percent chance that it will take 10 minutes or less). However, if your transaction remains unconfirmed, the recommended wait time is 72 hours before sending it again.

If you want to avoid paying fees, however, you can check to see how many unconfirmed transactions there are at a given moment and calculate how long it will take.

Ethereum Blockchain Confirmations

When it comes to Ethereum blockchain confirmations, the agreed-upon number seems to be undecided. According to the Ethereum white paper, 7 confirmations should be enough to confirm the transaction (about 2 minutes).

However, Ethereum miners must check the parameters of the last 250 blocks. So, if you want to err on the side of caution like the miners, you should wait for 250 confirmations. This sounds like a lot, but in practice is only about an hour.

Stack Exchange

Coinbase requires 50 ethereum confirmations before considering a transaction complete. It should also be noted that the Ethereum blockchain faces significant scalability issues as well. Ethereum is working to scale quickly to take on more users, and through Proof of Stake, confirmations should be even quicker.

Etherscan and Ether Gas

Ethereum doesn’t have a mempool for pending transactions; it’s simply called the transaction pool. The pool contains all the transactions submitted that haven’t yet been assigned to a block.

There are multiple methods for speeding up your transaction and deciding on the best gas price when sending your Ethereum transaction. You can try ETH Gas Station to see an overview of gas usage, and you can see how many transactions are pending by using Etherscan.

ETH Gas Station

Etherscan is particularly popular since you can order transactions by gas price (simply click on the GasPrice column). You’ll then see more or less the same list that miners see and, if you select a gas price that is within the first couple of pages, you should enjoy short confirmation times.

The Takeaway

Blockchain confirmations are essential for securing your transactions. The best way of ensuring a faster confirmation is by paying a higher fee. As all blockchains begin scaling up to prepare for even more users, it will be interesting to see how that affects the prices we pay and the times we wait.


This article by Christina Comben was previously published on Coincentral.com

About the Author:

Christina is a B2B writer and MBA, specializing in fintech, cybersecurity, blockchain, and other geeky areas. When she’s not at her computer, you’ll find her surfing, traveling, or relaxing with a glass of wine.

AI and Blockchain – Super Cool or a Little Creepy?

If you’re a tiny bit freaked out by the enormous potential of AI and blockchain, you’re not the only one. When Dolly the sheep was cloned in the 90s, a pertinent question arose. Just because we can, does it mean we should?

Just because AI and blockchain technologies combined may stop crimes before they happen, replace human jobs with robots, and assign every “thing” in the stratosphere an identity–does it mean they should?

Are AI and blockchain combined super cool or a little creepy? Let’s take a closer look.

Artificial Intelligence (AI)

AI and blockchain and are obviously two very different foundational technologies. AI uses machine learning to analyze complex data models, identify patterns, and recreate them, eventually mimicking the actions of a human being. Sophia the robot? Right. And yes… a little creepy.

Hanson Robotics may have treated the world to a dose of AI at its very best. But not everything that involves Artificial Intelligence is as visually stunning, unfathomably expensive (or mentally disturbing) as Sophia.

So, if you’re worried about robots wiping out the human race, you can probably relax for now. You have to admit, as creepy as the spontaneous jokes and flawless facial expressions were, they were also pretty cool:

AI isn’t all about making robots come to life either. In fact, we’re constantly using AI in daily applications, perhaps without even realizing. Think LinkedIn and its predictive text chat, Siri or Alexa, for slightly more subtle examples of AI without the paparazzi.

Blockchain

Without diving too deeply into the particularities of blockchain (you can read more about it here if you want to), its main characteristics are decentralization, transparency, immutability, and ability to govern autonomously with smart contracts.

Through blockchain technology, we can send funds from one country to another without worrying about conversion fees in next to no time. We can speculate on the future price of Bitcoin, track items in the supply chain, store public records securely, eradicate poverty, wipe out corruption, trade energy credits, give power back to musicians, and hundreds of other extremely cool things.

But blockchain has a few characteristics that can give the hibigeebies as well. Smart governance can be hard to get your head around, the idea that code is law, and that at some point in the future, it’s likely that IoT technology and blockchain will create autonomous things with no living person behind them.

“What happens when something goes bad? Who is responsible?” asked Malta’s Steve Tendon in his interview with us. “These questions need new laws to be addressed.”

When AI and Blockchain Work Together

There are several ways in which Artificial Intelligence and blockchain can work together, to help each other reach their full potential. For example, we’re still a long way off smart governance while issues exist with smart contracts. Namely that they’re only as good as the developer who programmed them and they cannot leave room for good faith or human interpretation. Perhaps through machine learning and AI, smart contracts can reach their full potential and autonomous societies can exist.

AI - Internet of Things

The decentralized nature of blockchain technology also means that AI computing power can be spread over nodes to drive down the cost and make it more accessible to all.

But, perhaps the main common thread between AI and blockchain is actually data. Sophia said in her speech, “think of me a smart input-output system.” Good AI is only as good as the data fed into it. This is where teaming the two technologies can get really useful (and really cool, as well).

Rather than an army of Sophias being poorly programmed and driverless cars crashing into pedestrians, blockchain can ensure that the data given machines is high-quality. And verified through its cryptography and immutability.

Since AI depends on meaningful data, blockchain could soon be a huge enabler to allow machines to learn faster and more efficiently. Not just Sophia, but financial transactions, smart contracts, predictive text, and more.

Some Everyday Examples

Intelligent Trading Foundation and AiX are examples of trading platforms that use AI and blockchain together. Making use of deep recurrent neural networks to make predictions on price movements of cryptocurrencies. By harnessing the latest AI tech, they can figure out whether the price of cryptocurrencies will go up or down. By using AI for intelligence and blockchain for trading, these platforms can provide the latest in technology on a secure platform.

DeepBrain Chain is an AI computing platform powered by blockchain technology to integrate computing resources that are currently scattered all over the world. Seeing a pattern? DATA.

DeepBrain Chain He Yong

In the energy industry, companies like Electrify are using blockchain to support AI and improve the efficiency of their network operations, reducing energy bills by as much as 25 percent. Blockchain can ensure the security and privacy of the data they process using AI and also provide enough data to make rigorous Artificial Intelligence possible.

In finance, AI and blockchain work together to improve efficiencies as well. Artificial Intelligence can automate the repetitive tasks and blockchain can secure the data. And the list of cool (and creepy) projects goes on.

The Takeaway

We may not have a Bladerunner situation on our hands or a Minority Report in which we find ourselves massacred by robots or slammed behind bars before committing a crime. But still, there is something a little ominous about a robot that looks like a human saying, “you be nice to me and I’ll be nice to you.”


This article was previously published on Coincentral.com

About the Author:

Christina is a B2B writer and MBA, specializing in fintech, cybersecurity, blockchain, and other geeky areas. When she’s not at her computer, you’ll find her surfing, traveling, or relaxing with a glass of wine.

 

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