Blockchain for enabling Construction 4.0

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The construction industry is a high impact sector and a key driver for all national economies, be it through employment of people, development and return on investment for the advancement of civilisation or as a fundamental stimulator for any economic activity. Yet, the complexity of construction, in particular with regards to design, legal and financial aspects, causes recurrent and chronical inefficiencies. Emerging technologies related to the fourth industrial revolution and specifically blockchain technology bring opportunities of overcoming these inefficiencies.

The Industry 4.0 emerged in the 2010s and is currently being defined as the merge of the ‘physical and digital’, the era where the ‘bits’ connect with ‘atoms’ and objects and environments become smart. There is a shift to almost instantaneous global distribution with popular YouTube videos being seen by billions of people and E-Scouters appearing simultaneously in many cities around the world.

The scope and magnitude of transformation is deep and wide, with, for example, software being distributed and update online and in real-time. This is an immense change and impacting billions of people. Never before we had to contemplate this scale of change.

The decomposition of the Industrial 4.0 can be describe in waves of changes (Case, 2017), with the first wave (1985-1999) charactering the development of the building blocks of hardware and software and the start of the broadcasting static information.

The second wave (2000-2015) was marked by the software as a service and the ability to search the world wide web, social networks and e-commerce. The second wave also introduced the use of mobile phones and the invention of the smart-phone and the app economy. This increased the number of internet users to 3.2 billion by 2015 (BBC, 2015).

We are currently experiencing the third ware of the Industry 4.0 (2016- Now). Internet access is ubiquitous and new business models are ‘born on-line’. This acceleration and degree of interconnectivity create the conditions for further development, bringing to us the rapid advances in the many different sciences in a similar fashion to the 1600’s Renascence. It might have an assimilation period of similar dimension (of about 200 years) or instead, it might match the accelerating times.

By 2025, it is expected that the world will have 75 billion things exchanging information in the IoT (Statista, 2019a). This information flow is becoming a detailed account of all and each one of us and how we interact with our environment. To prepare and respond to this new age of ubiquitous and embedded information, we have to consider technologies like blockchain.

Blockchain, also known as the ‘Trust Protocol’ (Milutinovic et al., 2016; Tapscott, 2016, p. 4), can be described as the amalgamation of a few technologies for secure decentralized data management and value transaction. The interest in Blockchain has been increasing since the idea of a decentralized cryptocurrency was developed in 2008 (Nakamoto, 2008) and Bitcoin was launched in 2009 (Wattles, 2017).

Blockchain has characteristics in its architecture that provide security, anonymity, provenance, immutability and purpose of data without any third-party organisation in control of data transactions. Because of this automation, blockchain creates novel opportunities in the many digital applications and ecosystems out there. It becomes particularly disruptive in cyber-physical systems, the Internet of things, cloud computing, cognitive computing and other automation and data exchange processes relevant for the manufacturing technologies and the fourth Industrial revolution (Hermann et al., 2016; Kagermann et al., 2013; Schwab, 2017).

The general field of Distributed Ledgers Technologies (DLT), with and without the blockchain component, is also highly relevant in application for Virtual Environments (VE), including Building Information Modelling (BIM) and digital construction management. In this work we investigate the consequences of blockchain in relation to technologies associated with the construction sector, examining current case studies and discussing the prospects of the evolving technology itself.

We also discuss some known limitations and challenges in implementing the technology and how this reflects in prospective applications in the construction sectors.


Keywords

Construction, Industry 4.0, Blockchain, BIM, BEP, EIRs, DLT, Smart Contracts, Computational Contracts, LegalTech, LawTech, DAO, Construction Contracts, Tokenization, Total Lifecycle, Circular Economy

Bibliographic Details

Maciel, A. (Ed.), 2020. Use of Blockchain for enabling Construction 4.0, in: Construction 4.0: An Innovation Platform for the Built Environment. Routledge, Abingdon, Oxon ; New York, NY.