Can I order a Big Mac with bitcoin? Not yet, but bitcoin (cryptocurrency) excites many, and is based entirely on blockchain. But is blockchain ready for prime-time in aviation?

Use of popular words is observed to cycle through articles, literature, and social media with some regularity. For example, use of the terms ‘core competency’ and ‘paradigm’ seem to be waning. On the other hand, use of the word ‘disruptive’ seems to be peaking. Initially, use of this word demanded our attention; a herald of a new order of things, but alas, marketers have been attaching this adjective to too many products and ideas, and many simply are not worthy of the term, thus the effectiveness of the word has been diluted.

Predictably an idea we often see described as ‘disruptive’ is blockchain technology. Will it truly be ‘disruptive’, and further, what may be its implications on aviation, if at all?

WHAT’s BLOCKCHAIN?

In the excerpt below, the italics are my own for emphasis

”A blockchain, originally block chain, is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a hash pointer as a link to a previous block, a timestamp and transaction data. By design, blockchains are inherently resistant to modification of the data. It is an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority.

Blockchains are secure by design and are an example of a distributed computing system with high Byzantine fault tolerance. Decentralized consensus has therefore been achieved with a blockchain. This makes blockchains potentially suitable for the recording of events, medical records, and other records management activities, such as identity management, transaction processing, documenting provenance, food traceability or voting.

The first blockchain was conceptualized in 2008 by an anonymous person or group known as Satoshi Nakamoto and implemented in 2009 as a core component of bitcoin where it serves as the public ledger for all transactions. The invention of the blockchain for bitcoin made it the first digital currency to solve the double spending problem without the need of a trusted authority or central server. The bitcoin design has been the inspiration for other applications.”¹

BLOCKCHAIN IN AVIATION?

Aviation is dependent on strict record keeping. Much of today’s record keeping procedures are required by regulation and yet others by de-facto industry practice. The continuum of aviation records typically starts in manufacturing during/before metal is cut, software written, or assembly tools laser measured, and extends the entire life cycle to the end with a record of being scrapped.

For all of us in the aftermarket, we are intensely attuned to the issue of impeccable records. There is after all, clear correlation between the value of the parts (assets, articles) and the quality of its records. We tend to be particularly sensitive to these records:

• Traceability – That pesky unbroken chain of custody demanded by end users
• Part Status – Life Limited Parts, Existing Time and Cycles, Time Since Overhaul, Existing Condition, Modifications, Alterations, Service Bulletins, and Airworthiness Directives among others

The known problem of these records is that they tend to take many forms: Paper, digital, Logbooks, and Scanned PDFs, and that there is no single repository of these records. Often the records are archived; a polite way of really saying it’s in the black hole of hundreds of those legal cardboard boxes in the warehouse…good luck with that…

So…can blockchain be the answer? According to some; yes.

According to Mr. Bas De Vos:

“…what if all of these participants submitted a transcript of the transactions into a purpose-specific, distributed ledger — like blockchain — which only authorized participants would have access to?

The manufacturer would initially start the blockchain for the asset and each participant would add the relevant blocks to it. The distributor would let the chain’s participants know that the asset was transported from point A to point B, while the operator would register the number of flight hours that the asset has undergone.

Using blockchain for this asset management scenario would give you a 100 percent verifiable, traceable, and trustworthy history of the asset’s lifecycle in real-time.”²

And according to AeroTime Staff:

“…blockchain technology has the power to transform the asset management value chain—and the firms that adopt it early will reap the rewards. Commercial aircraft assets are definitely an untapped market, with a visible lack of standardization. A blockchain solution could potentially replace the network of disparate systems, Justinas Gilys, COO at AviaAM Leasing believes.

“A blockchain registry would, first of all, provide a high degree of transparency,” Gilys told AeroTime.

Transparency brought by a secure ledger would increase the efficiency of transactions for all the parties involved, Justinas Gilys of AviaAM Leasing believes.

“A secure blockchain solution would help to effectively secure the interests of both aircraft owners and financiers.”

Unlike traditional databases, blockchain-based registries are consistent, immutable and secure from outside tampering.”³

Sounds pretty promising, but to be sure, there are detractors. For example:

“ ‘The thing is that this technology is way over-hyped and filled with over-positive expectations,“ Beliunas told AeroTime. As I’ve been arguing this for quite a while, many leaders and executives see it as a magic word and a solution to all of their pain points. And this is most definitely not the case. What they should be doing is their research trying to identify their specific use cases and tailored solutions instead of jumping straight on the bandwagon. But lessons will be learned, one way or another.’ “³

There are also existing avenues within the industry attempting to address the aforementioned records problems. Among these:

• Placing RFID chips on assets. The chips would be the repository of the records.
• ATA Spec 2000 protocols for traceability and part marking.
• Still other independent firms have tried being the repository, safety deposit box of records.

I distinctly remember years ago in my avionics and flying ventures of a new system called MLS: Microwave Landing System. It was supposed to allow curved instrument approaches and multiple approaches among its many benefits. In fact the USAF for example went through considerable expense to install the required hardware on many aircraft while the FAA was installing the systems at a few airports. Then out of left field came GPS. MLS was forgotten, and today GPS-based instrument approaches are common place. GPS was disruptive before disruption was hip. Will blockchain be to RFID what GPS was to MLS?

GOING FORWARD

In an article Titled “Microsoft Azure Supporting Blockchain Test by AFI KLM E&M, Ramco,”⁴ it appears that

“Microsoft has developed a solid infrastructure on its Azure Cloud platform for a variety of implementations of Blockchain and is now working with AFI KLM E&M and Ramco Systems on a test of Blockchain for providing back-to-birth records of aviation parts.”

The bold italics are mine, and wow, fasten your seatbelts.

I hope that global Civil Aviation Authorities are paying attention. Regulations and guidance regarding electronic recording keeping may have to be updated to accommodate this new platform.

Over ‘n out

Roy ‘Royboy’ Resto

AimSolutionsConsulting.com

¹ https://en.wikipedia.org/wiki/Blockchain

² http://www.aviationpros.com/article/12363451/using-blockchain-to-reinforce-aviation-asset-management

³ https://aerotime.aero/en/civil/20680-3-ways-blockchain-technology-is-disrupting-aviation

⁴ www.mro-network.com/maintenance-repair-overhaul/microsoft-azure-supporting-blockchain-test-afi-klm-em-ramco