Blockchain Technology and the Quest to Transform the Travel Industry
The year 2018 hasn’t particularly been the best year for cryptocurrencies, as the bear market had eroded value in almost every digital asset out there.
However, while cryptocurrencies aren’t having the best of times, blockchain technology has managed to stay relevant, with organizations and governments coming out with ways through which they can use blockchain as a tool for growth and advancement. One particular sector that has witnessed a tremendous use of the nascent technology has been the travel industry, where even airports have adopted the use of cryptocurrencies as a means of payment.
Cutting out the Middlemen
As it is with any industry, the presence of middlemen has always been one of the major issues with the transport industry. Since these their parties provide the customers with relations and communications with hotels, airlines, and other travel service providers, they also lead to an increase in transaction costs.
Third parties like TripAdvisor end up charging for the services that they provide, and this can add up to your already huge fees.
With the use of blockchain technology, a consumer could perform their travel and hotel bookings through the execution of a smart contract, thereby eliminating the need for middlemen like Expedia and Hotels.com. In like manner, the hotel or airline will be able to trust that the payment from their customers will get to them seamlessly, within a short period. Travel intermediaries are notorious for payment initialization issues, which often lead to a disruption of the customer’s itinerary.
Take LockTrip for example. The company provides a platform for people to locate and relate with hotels, airlines, etc. Primarily, it offers proper communication between the end vendors, while also ensuring that intermediaries- who hardly create any value- are in nowhere the picture.
LockTrip CEO Nikola Alexandrov told Forbes in an interview that his startup has been able to do even well, despite the effects of the bear market.
Our project has outperformed the market with +200% during the bearish market. Our prices are so cheap; we are not allowed to advertise them in Trivago.
Improved Payment Security
One of the most glaring areas where the transport and travel industry can benefit from the integration of blockchain technology is in ensuring the security of payments made online. Although there has been much improvement in the digital payment space move the past decade (thanks to the work of fintech firms and innovative online vendors), the transport industry still loses billions of dollars on an annual basis due to fraudulent transactions and scams. A report showed that the airline industry loses $1 billion monthly to credit card payment fraud.
This brings the need for innovative technology to help ensure customer security and protection. The blockchain, thanks to its decentralized nature, is unable to go offline, and this means that information which is stored on here can never be tampered with, even in the event of an attack. Also, transactions carried out on a decentralized ledger are secure and traceable. This will make it much easier to ensure that storage and retention of valuable information.
Proper Identity Verification
The transport industry has always been reliant on the use of effective identification services, and this is another area where the distributed ledger technology excels. Blockchain can provide travelers with digital identities; a feat which can significantly improve the efficiency of airports all over the world and provide for a much more enjoyable user experience.
With blockchain technology, checkout lines and queues at airports will be drastically reduced, and we can also see a world where documents like driver’s licenses and passports can be replaced with facial scans and other digital and biometric information. This would curb identity theft and improve the general reputation of the transport industry.
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