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The Intergration of Blockchain and Construction Industry Can be Lube for Urbanization

The application of blockchain technology in architecture is under heated discussion, which is a good opportunity for the construction industry to embrace and integrate with the Internet. Of course, as many challenges follow, is it possible to develop a series of building products based on this demand and improve the traditional construction industry in the future?

In the construction industry, a large number of teams are designing our architecture environment. With the gradual popularization of technology and BIM (Building Information Model), collaboration in various fields and some new concepts are widely spread in construction industry. Obviously, this trend can promote the application of blockchain technology in this field.

As an multiply intensive industry, the construction industry involves many fields, such as labor, resources and capital. Statistics show that the housing construction industry can stimulate the development of  hundreds of sub-industries. Given that there are too many stakeholders involved in the construction industry, and many links have failed to form brand effect for many years, so there is a high cost of coordination and trust.

In a macro view, the industry chain of the construction industry is relatively simple, and its core stakeholders are generally project owners. However, From the micro view, there will be small links in many large links. Various frictions occur between these links, thus providing opportunities for the application of blockchain.

Construction industry is facing an extremely difficult issue of excessive coordination cost. With the participation of many stakeholders and the low penetration of technology, the complexity of collaboration network in construction industry exceeds that of general commodity and service transactions. It is easy to bring higher collaboration costs because of information asymmetry.

Facing the situation, since the 21st century, the construction industry has adopt a solution named BIM by using computer technology. Theoretically, if BIM technology can be melt into the whole process of construction, many stakeholders, including designer, supervision and owner, will be able to master the progress of the project, thereby improving the efficiency of the system.

Like other digital technologies, the promotion of BIM faces two bottlenecks, one of which is trust. At present, most architectural drawings are provided by design institutes. However, considering that providing too detailed information may lead to the loss of intellectual property rights, the design institute is cautious in providing drawings. For example, many design institutes only provide paper form instead of electronic form when using 2D drawings. Even if electronic version is provided, it is in the form which can not be edited and modified.

By deploying using and modifying records, liability risk clauses, and intellectual property ownership information in BIM model on the blockchain, we can confirm the rights of building models and know the sources of information modifying in the absence of authoritative third-party.

In addition, other encryption techniques can be used to reject requests for copy of drawings models to avoid information plagiarism. Only in this way can the design institutes trust other stakeholders and finally agree to release a modifiable BIM building model.

Moreover, blockchain can be used in the process of project bidding, which enables the bidding process to be recorded and supervised on the platform where information is extremely difficult to be tampered with, and it greatly reduces the information asymmetry and grey interests. For example, blockchain fund management platform can be set up to upload all the company’s labor contracts, bank accounts, and wages. Considering that many construction enterprises depend on the owner’s project funds, through the relevant transaction records and the flow of funds, the licensed stakeholders can clearly see whether there is sub-contract or trancontract in the process of the project.

Therefore, if we want to change the current chaos in the construction industry, we should start from improving the industry environment, in the value chain of “owner-bidder-subcontracting enterprise”, eliminating those industries that may affect the quality of the project. Then the blockchain can provide technical support for preventing the chaos as a supplement.

As a traditional industry, construction industry may requires plenty of time before being equipped with blockchain. All in all, construction industry is one of the most suitable industry for materialisation of blockchain, as there are few renowned service supplier and authoritative intermediary.

COMMENTS(2)

  • Vinent he
    3 weeks ago Vinent he

    The Intergration of Blockchain and Construction Industry Can be Lube for Urbanizationhttps://news.8btc.com/the-intergration-of-blockchain-and-construction-industry-can-be-lube-for-urbanization …

  • 8BTCnews
    3 weeks ago 8BTCnews

    The Intergration of #Blockchain and Construction Industry Can be Lube for Urbanizationhttps://news.8btc.com/the-intergration-of-blockchain-and-construction-industry-can-be-lube-for-urbanization …

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