By Team Mystifly on May 16, 2018 3:17:42 PM
Blockchain, although in its infancy, has generated significant excitement in the Travel Industry. While this breakthrough technology has been heralded by many and is certain to revolutionize various industries, what impact will it have on the Travel Industry? Blockchain, which functions as an online ledger, harnesses the potential to make the travel process faster, simpler and more secure. Its wide range of applications, and decentralized nature, challenges the traditional set-up in exchange for greater stability and security which serves to benefit all key players in the travel process.
What is Blockchain?
Simply put, Blockchain is an online decentralized database. It stores, records and maintains transactions (anything of value – physical or not) between entities across a peer-to-peer network. The fundamental feature of Blockchain – decentralized data, ensures that transactions flow only between the participating entities, which negate the need for third party involvement.
The decentralized nature of Blockchain means that data can neither be erased nor manipulated. This translates to more secure, permanent, traceable and transparent data –in turn, decreased dependence on intermediaries. This means Blockchain has the potential to protect transactions against fraud, and malicious cyber-attacks.
It is for these reasons that the Travel Industry is finding new and innovative ways to build applications based on Blockchain technology to help reshape the travel process. Here’s a brief overview on how the Travel Industry is employing Blockchain in its functioning:
- Decentralized Distribution
The Travel Industry is currently dominated by a handful of companies that serve as umbrellas to numerous affiliates. In essence, when a traveler is on the look-out for competitive prices, he/she is nearly always comparing prices between two parent companies. This is where a public Blockchain domain can decentralize the existing set-up; provide greater involvement from suppliers and a personalized distribution process. But first, what is public Blockchain? A public Blockchain is an open network where anyone can join and participate.
Winding Tree is one such example of a public Blockchain network which allows suppliers to list and distribute their inventories. Direct distribution between entities utilizing public Blockchain eliminates the cost of multiple re-routes and thus helps save on unnecessary fees and charges. This also provides the retailers with a plethora of choices, as they will be able to source fares from suppliers across the network. All of this culminates in an enhanced and faster travel booking experience for the traveler.
- Decentralized Transactions
In the current scenario, money travels from one point to another and then yet another when a flight ticket is purchased. This extensive set-up results in the loss of time and resources. In addition, surcharges and fees are levied that prove to be costly to all parties involved in the booking process. IATA has proposed its own cryptocurrency – IATA Coin, as the remedy to the transaction woes that the Travel Industry has been experiencing. Built on Blockchain technology, IATA Coin, a digital universal cryptocoin for all airline transactions, would not only increase the speed of transaction, ensure transparency, and do away with surcharges; it could also be used for universal loyalty programs. This would provide travelers with the opportunity to avail loyalty programs such as frequent flyer miles irrespective of which airline they might be flying. Although, IATA has yet to provide a detailed plan on how it intends on taking the IATA Coin further, cryptocurrencies such as Lif, BitAir, and TOA coin have already begun facilitating transactions for travel related services.
- Decentralized Data Exchange
Data security has been a recurring issue in the present world. The recent privacy breach by Facebook and Cambridge Analytica stands to prove how real this concern is. This ongoing threat to personal data has brought data security to the forefront in the Travel Industry. Blockchain’s encryption capabilities, decentralized nature, and the fact that data is distributed across millions of computers and networks make hacking a challenging task.
TravelChain, an open source Blockchain platform stores data on travelers and travel businesses. TravelChain allows users to determine how their data will be used and with whom it will be shared. In exchange for information, TravelChain provides users with travel tokens – TravelChain’s incentive for the sharing of data. Travel businesses are able to analyse user data to determine and build unique and personalized offers.
With Blockchain being utilized in innovative applications and practices, it should come as no surprise that it will lead to exciting innovation that will reshape and reinvent travel as we know it. The Travel Industry, as evident, has already made headway towards a secure, transparent and seamless future. One can only imagine the application and learning as this revolutionary technology evolves.
To learn more about how Blockchain will rattle the Travel Industry, click here.