Wal-Mart Explores Blockchain for Delivery Drones

Robert Hackett

May 30, 2017

Walmart has its eye on blockchain technology.

The United States Patent and Trademark Office (USPTO) recently published a patent filed by the mega-retailer for a "delivery management system" that aims to improve upon last mile shipping—the final stretch extending to consumers' homes—by using robotics, sensors, and yes, blockchains, also often referred to as distributed ledgers.

Blockchains are a kind of data structure that's dispersed across a network of computers in a way that proponents say is more secure than traditional means of record-keeping. Some companies, like the Danish shipping giant Maersk, are banking on the tech potentially reducing fraud and inaccuracies in their supply chains.

The patent application, entitled "Unmanned aerial delivery to secure location," describes a process by which Wal-Mart (WMT, +0.58%) could automate the logistics of delivery drones. Coindesk, a Bitcoin and blockchain-tracking trade site, first spotted the filing on Tuesday.

Although the patent application is vague on specifics, its authors lay out the general mechanics of a hypothetical delivery. Here's how it works: As a drone approaches a delivery box, it authenticates itself with a "blockchain identifier," a type of numeric or encrypted key. If the code is valid, then the box unlocks, opens, and accepts the package.

When a package arrives at its destination, its receipt could trigger a notification to be sent to a consumers' mobile device.

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Wal-Mart can use a blockchain not only to authenticate identity, but to also track other useful information about a package as it moves through a supply chain, too. For instance, a blockchain-based database could log information such as time, location, handlers, delivery date, temperature, pickup protocols, and other data in a tamper-resistant format that's accessible to—and able to be trusted by—couriers, customers, and any other intermediaries along a package's route.

Here's a diagram of the system. (You can read the details in the filing.)

Wal-Mart has been exploring blockchain technology for some time. In October 2016, the company announced that it would partner with IBM (IBM, +0.59%) to digitally track shipments of pork in China using a blockchain.

Wal-Mart filed a patent application for this delivery management system a year prior to the IBM announcement on November 25, 2015. (Wal-Mart did not immediately respond to Fortune's request for more information about the filing.)

Wal-Mart's initiative represents just one potential application of the still nascent technology. Blockchains continue to be hyped for their potential to disrupt many areas of business, including financial services, supply chains, media, and governance.