Warren Buffett Gets Involved With Blockchain Through His BNSFR Railway Company

BNSF Railway Company, a subsidiary of Berkshire Hathaway which is owned by business tycoon Warren Buffet recently announced that it became the first major railroad firm in the U.S to incorporate blockchain technology in the Transport alliance.

The alliance consists of over 200 firms that have been trying to determine how to best take advantage of blockchain technology in the transport industry. Blockchain is the same digital ledger technology that is behind cryptocurrency. The alliance also plans to set standards for blockchain in various areas including fraud prevention, quality control, and vehicle maintenance.

Muru Murugappan, the Vice President of technology and services and CIO of BNSF had this to say: “Blockchain technology has the potential to change several aspects of the transportation industry and it is important that the industry comes together to align around a set of standards."

The announcement also means that BNSF is now among the first North American railroad operators to start evaluating Bitcoin as a vehicle for driving transformation in the industry. The alliance is made up of some high profile companies such as United Parcel Service, shippers FedEx Corp, SAP and Bridgestone Corp. Some brokers and banks are also part of the company. BNSF plans to work together with some of the members of the Alliance to determine how blockchain can be used to handle data in freight transportation.

In one of his statements, Murugappan pointed out that it is important for the companies in the transportation industry to work together towards creating a set of standards. BNSF has operations in Canada and 28 states in the U.S. The company made $2.84 billion in profit within the first nine months in 2017. It is also one of the largest subsidiaries of Berkshire Hathaway.

The announcement about the BNSF’s involvement in blockchain does not mean that the company will be dealing with cryptocurrency. Most major investors have been quite sceptic about dipping their toes in the cryptocurrency industry especially due to its highly volatile nature. However, it is worth noting that the firm will mainly focus on taking advantage of the digital ledger technology to create a system that will use secure blockchain-based networks to manage operations. These highlights the other advantages that this digital ledger technology offers such as smart contracts which promise to revolutionize how corporates handle data.

BNSF is currently in the early stages of determining how to put the pieces of the puzzle together with blockchain included. The firm will most likely reveal the details of any progress as time goes by.