Blockchain tech continues to make headway into the logistics industry, and dexFreight, a startup with Dallas connections, is helping connect shippers with the trucks they need to move merchandise more efficiently.
After months of behind-the-scenes work, dexFreight—a decentralized, blockchain-based logistics platform startup—was officially founded in January with blockchain as an integral part of the company vision, Rajat Rajbhandari, co-founder and CEO, told Dallas Innovates.
The company entered the space recently with its first blockchain shipment using smart contracts. On Oct. 15 in Florida, as a test of dexFreight’s MVP (minimum viable product), the shipment of frozen seafood went out.
Seafood wholesaler Netuno USA posted the load on the dexFreight platform, and Arel Trucking, the carrier, found the load and proposed a transport cost. The shipper and carrier negotiated a rate and agreed on terms, and the contract details were recorded on smart contracts stored on the Bitcoin-powered RSK platform.
“This was a first, but a very important, step,” Rajbhandari said about the shipment, adding, “Our entire leadership team, along with Diego Gutierrez (CEO of RSK), and Luciano Bonaldo (president and co-founder of Netuno USA) follow closely the entire process to make sure it was completed efficiently.”
Although the first shipment occurred in Florida, where dexFreight is headquartered, the startup has strong Dallas ties. Rajbhandari lives in Dallas, and the company is planning to establish a formal presence in North Texas, citing DFW as a major logistics hub.
Rajat Rajbhandari is the CEO and co-founder of dexFreight. [Image: dexFreight]
Blockchain and logistics
The idea behind dexFreight’s blockchain and smart contract business model is that it allows shippers, carriers, and other supply chain stakeholders to transact and collaborate more efficiently and securely.
“The platform is powered by an ecosystem of open-source protocols using smart contracts to deliver visibility, transparency, and a trust layer that is lacking in today’s logistics process,” Rajbhandari said.
Similar companies also are working in the intersection of blockchain and logistics—IBM and Consensys—but Rajbhandari said he doesn’t consider them direct competitors.
More-established logistics startups such as Convoy and Uber Freight also are potential competitors, but Rajbhandari said they, unlike dexFreight, do not use blockchain tech as a trust protocol.
Rajbhandari cited Fr8 Network, ShipChain, and CargoX, as direct competitors, but added dexFreight’s differentiator is its platform as an end-to-end solution within a single marketplace offering a fully decentralized transaction option.
Blockchain evangelists point to logistics as a natural fit for the industry sector and technology.
The challenge, however, is quantifying the benefits of blockchain by finding the right set of value propositions and conducting proof-of-concepts. Rajbhandari said he sees the technology maturing over the next two to five years with large-scale penetration in logistics happening in five to 10 years.
“When it comes to technology adoption, logistics and supply chain industry follows a trickle-down trend,” he said. “Meaning bigger companies adopt it and then trickles to medium and small companies that work with bigger companies. Because blockchain is relatively inexpensive to implement and due to the fact it is open-source, we think blockchain can be adopted by small and bigger companies at the same time as bigger ones.”
Small- and medium-sized companies are most likely to benefit from dexFreight as they are unlike to have the resources to develop their own blockchain solutions. Many will have to rely on services from startups such as dexFreight to realize the benefits of blockchain in logistics.
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