Blockchain in Tourism - Explained

Blockchain in Tourism - Explained

Blockchain and tourism have the potential to show into a really advantageous combination as this technology will offer additional security and transparency to important touchpoints. In the case of an agency booking flights and hotels for a client, it's to send the data to the various corporations.

Blockchain may build this operation safer and additional clear since the responsibility gets unfold throughout the entire network. The same can happen with foreign transactions, increasing the level of trust among all the involved parties.

The blockchain is a principled digital ledger of transactions which can be automated to store not only financial dealings but everything which holds value.

It stores information across a series of computers on a P2P network. The data could be accessed in real time which can be seen throughout networks and make it possible to view the history of the goods as well as its components.

Tourism-Economic Growth

Tourism can be defined as travelling to a place which is different from your home city or country for various leisure or business purposes, and staying there for some considerable period of time at a length. It is motion for a few purposes and for keep that isn't terribly long or permanent in nature.Tourism becomes an activity which builds the base for the wide scale consumption bringing far reaching benefits. Tourism gains importance as an activity that has so much reaching positive impacts on industries, economy, society and therefore for the whole growth, progress and development of a country.

The definition of tourism also creates the foundation and the broad context of the tourism industry through which most of the advantages and benefits are received by the country as a whole. The best way to describe, structure and define tourism industry is to look at it through the definition and explanation of tourism. Tourism definition higher than shows that it's a group of actions or activities, i.e., travelling to a place, staying there and further local travelling.

On this basis, we can define tourism industry as the consumption or use of all services and products by travellers throughout their tourism oriented travel trip. This is the demand aspect definition of tourism industry. The supply side tourism industry definition will be like: Tourism industry is a group of industries providing services and products for various needs of tourists and travellers on leisure, business and other related tourism characterized travel trips. What the tourists spend on consumption of these services and products becomes the revenues of tourism industry.

Blockchain technology comes with plenty of distinctive characteristics and traits which may profit companies in some ways. Some of these features include:

  • Improved security
  • Eradication of middleman or third party
  • Data integrity
  • Decentralized business models
  • Immutability and transparency
Blockchain in Tourism - Explained

Removing the Middlemen

As it is with any business, the presence of middlemen has invariably been one in every of the key problems with the transport business. Since these their parties offer the shoppers with relations and communications with hotels, airlines, and alternative travel service suppliers, they conjointly result in a rise in group action prices.

Third parties like TripAdvisor find yourself charging for the services that they supply, and this may add up to your already vast fees.

With the employment of blockchain technology, a shopper might perform their travel and building bookings through the execution of a sensible contract, thereby eliminating the requirement for middlemen like Expedia and In like manner, the building or airline are able to trust that the payment from their customers can get to them seamlessly, at intervals a brief amount. Travel intermediaries square measure infamous for payment format problems, which regularly result in a pause of the customer's itinerary.

Culture Mining

Culture mining is the epitome of social blockchain in cultural communities. Traditional activities are receptive culture tokens issue. Those activities will need to be sanctioned by the communities as the representation of cultural heritage. Moreover, any member involved in culture mining will need to certify the issued tokens by the community.

For example, art crafts for indigenous festival might have no financial incentive. With culture mining, the artists can issue tokens based on their work and then make it certified by the community. It serves as a 11financial incentive for cultural participants. This mechanism will encourage a cultural preservation which in turn will strengthen the community identity and tourism value.

The other uses blockchain within the hospitality and travel industry can be:

1. Tracking Luggage:

Blockchain technology can be extremely helpful for tracking the changing destination of luggage, particularly when dealing with international travel. In many cases, a customer’s luggage shifts hands multiple times over the progression of their journey. Using blockchain for this purpose makes sharing tracking data between companies a lot easier.

2. Identification Services:

Identification services are significantly important for the travel industry and blockchain could probably match the industry standard for storing this information. If used in the right way, the technology has the potential to reduce check-in times, or queues in airports, as a simple fingerprint or retina scan, can replace showing documents.

3. Payments Traceability:

The most important use of blockchain technology within the hotel and travel industry is linked to payments. The technology’s applications can range from working as a ledger, making bank payments more simple and secure, through to allowing travel companies to accept payments using Bitcoin or other cryptocurrencies.

4. Customer Loyalty Schemes:

Finally, travel companies run customer loyalty plans, in order to further earn more customers and make the current customers happy. Blockchain can also help with these programmes by simplifying the process, enabling customers to easily access information regarding their loyalty points and allowing tokens to be distributed.

Companies Using Blockchain to Change Travel

1. Winding Tree:

The major travel service aggregators that emerged across the web like Expedia and Priceline have since return to dominate transportation bookings, but at a serious cost to both travellers and airlines. Bookings on these websites tend to include hefty fees and surcharges made possible by their largely unchallenged status as gatekeepers.

Blockchain-based startup Winding Tree is already operating to unseat these entrenched giants by difficult their role as trade middlemen.

2. Cool Cousin:

Identifying a region’s highlights and potential attractions is a big part of the planning process for travellers. Major names like Lonely Planet and TripAdvisor offer some guidance, but are hurt by issues stemming from their lack of transparency and profit-oriented models.

Launched in 2016 in Tel Aviv and today used by over 500,000 travellers worldwide, Cool Cousin - with its curated travel experience - seeks to provide a better alternative for tourists.

The company’s blockchain-based scheme incentivizes native guides to decriminalise their native information to supply an additional responsible and authentic tour chance for the application’s users.

3. Webjet:

Inaccurate or lost hotel bookings add considerable stress and anxiety to a travel experience. Furthermore, customers usually have to take on fees across several layers of the supply chain while providers consistently extract value.

Webjet, an outstanding on-line agency, has built a new model designed to avoid these irritating booking experiences.

The system enhances the customer experience by recording all entries on the blockchain’s immutable ledger, which reduces the likelihood of mistaken or lost bookings and reduces the layers between sellers and consumers.

Moreover, the technology’s improved security features provide better protection for the ecosystem. Apart from building bigger provide chain efficiencies and reducing prices for hotels, travellers ultimately benefit from lower cost booking alongside transparency and greater accountability.

4. Sandblock:

In the hyper-competitive travel and tourism industry, loyalty rewards have gone through several iterations, but only the most recent offers a real departure thanks to blockchain.

Many frequent travellers belong to airline and hotel loyalty programs. However, defrayment points and miles typically means that jumping through multiple hoops to redeem rewards. Furthermore, despite high rates of participation in loyalty programs, many customers report a willingness to accept better deals from competing carriers and service providers if the price is right.

New entrant Sandblock is looking to radically change the loyalty landscape with its blockchain-based platform. The company’s system allows travel suppliers to form their own loyalty tokens, which can be exchanged not just for brand-specific rewards, but be used like real coins and even exchanged for fiat.

5. Travelchain:

Data has become a prized commodity in today’s economy, offering businesses numerous insights and advantages when used appropriately. Travelers generate massive amounts of data that are highly valuable to service providers, though that information is generally restricted to gatekeepers such as Expedia and Orbitz, which offer a faster booking process at a price. The result is an ecosystem that raises the costs for travellers and adds to the informational asymmetry for travel service providers.

New entrant Travelchain is looking to upend the paradigm with an open-source blockchain that seeks to remove intermediaries on the supply chain. Users area unit sceptred to gather and decriminalise their travel knowledge, keeping it safe from prying eyes and receiving tokens as compensation for sharing with travel service suppliers. These tokens can then be redeemed for services or money.

Payment Security

One of the foremost obtrusive areas wherever the transport and travel business will get pleasure from the combination of blockchain technology is in guaranteeing the protection of payments created on-line. Though there has been a lot of improvement within the digital payment house move the past decade (thanks to the work of fintech corporations and innovative on-line vendors), the transport business still loses billions of dollars on an annual basis due to fraudulent transactions and scams. A report showed that the airline industry loses $1 billion monthly to credit card payment fraud.

This brings the requirement for innovative technology to assist guarantee client security and protection. The blockchain, due to its localized nature, is unable to travel offline, and this implies that info that is keep on here can never be tampered with, even in the event of an attack. Also, transactions administered on a localized ledger are secure and traceable. This may build it a lot of easier to make sure that storage and retention of valuable info.

Effective Identity Verification

Blockchain in Tourism - Explained

The transport business has continuously been dependent on the employment of effective identification services, and this is often another space wherever the distributed ledger technology excels. Blockchain will give travellers with digital identities; an achievement which might considerably improve the potency of airports all over the world and provide for a much more enjoyable user experience.

With blockchain technology, checkout lines and queues at airports are going to be drastically reduced, and that we can even see a world wherever documents like driver’s licenses and passports may be replaced with facial scans and different digital and biometric info. This may curb fraud and improve the overall name of the transport business.

Airbnb on Blockchain

Blockchain in Tourism - Explained

Airbnb is reported to be acting on increasing the variety of services it offers out on the far side accommodation. noted among the corporate as ‘Magical Trips’, it'll before long supply services and experiences to its guests like “meals ready by personal chefs, eating house reservations, room tours, and bicycle rentals.”

Airbnb’s co-founder and CTO Nathan Blecharczyk was asked regarding his company’s interest in Blockchain. Best noted for its use within the cryptocurrency Bitcoin, Blockchain is an encoded public ledger that maintains a continuously-growing list of data records that refer to previous items on this list. Many see it as a holy grail for the development of online trust. Blecharczyk replied: “We’re looking for all different kinds of signals to tell us whether someone is reputable, and I could certainly see some of these more novel types of signals being plugged into our engine.”

Last year the Greek Island of Agistri began an experiment with a blockchain altered cryptocurrency referred to as Drachmae that may enable tourists and travel businesses to avoid the collapse of Greece’s ancient economy and still interact confidently whereas on the island. The story suggests the way for regional destinations to insulate themselves against any economic shocks which may befall the countries of that they are part.

Blockchain-Backed Payment Mechanism in the Indian Tourism Industry

Singapore-headquartered Locus Chain Foundation, a Blockchain technology company, signed a strategic partnership agreement with Let’s Fly Free to introduce Locus Chain digital currency as a mode of payment within the travel and tourism industry. Let’s Fly Free is an internet travel and business enterprise platform primarily based in India with quite a million paid users.

Blockchain in Tourism - Explained

Blockchain cases for Adoption

1. Inventory Management for Greater Visibility

Blockchain in Tourism - Explained

Poor visibility on the inventory typically results in overbooking, cancellations and refunds. In a blockchain, each confirmed booking, be it a direct sale or a booking made by an agent, will be added as a transaction block. All participants can so have a unified read of the remaining inventory. It also can facilitate airlines and hotels monitor the fill rate.

Switzerland-based travel platform Winding Tree is developing a fully public, blockchain-powered marketplace for travel inventory (hotel rooms, flights and even experiences). This will modify suppliers to list their inventories and agents to book through it. The TUI Group is already using smart contracts on its private blockchain to manage bed inventories across its partners' property management systems.

2. Seamless Transactions and Settlement

Blockchain in Tourism - Explained

The sheer volume of transactions in the travel industry leads to data discrepancies and costs companies billions of dollars. When all transactions are shared simultaneously across the distributed ledger, the reconciliation time for each transaction will reduce significantly.

Transactions on blockchains will be governed by smart contracts that encode the rules of the commercial relationship between participants. Digitally shared contracts increase trust in the ecosystem and significantly reduce the time and costs involved in executing them.

For instance, the Winding Tree public blockchain incorporates a collection of smart contracts on Ethereum (one of the two largest public blockchain networks, the other being Bitcoin) with a Decentralized Autonomous Organization (DAO) governance platform.

3. Frequent Flyer Program Management

Blockchain will remodel the loyalty membership expertise for businesses furthermore as customers. On a distributed blockchain ledger, loyalty rewards offered by travel companies can be tokenized and redeemed immediately. In a vast blockchain that includes almost all travel players, customers’ redemption options will multiply exponentially, including the option to transfer tokens to friends or convert them to cryptocurrencies.

Loyyal, a technology startup, has launched a blockchain-based universal loyalty and rewards platform. This will create it easier for firms to manage loyalty liabilities whereas giving multi-brand rewards programs furthermore as tailored redemption choices.

The Jumeirah Group, in partnership with Dubai Holding, is using the Loyyal platform to enhance the efficiency of its loyalty programs. Scandinavian native governments are victimization the platform to spice up commercial enterprise.

The trending hacks and scams in the crypto world have caused distrust and disappointment in crypto enthusiasts. However, despite losing religion in Bitcoin or different cryptocurrencies, many still believe in the potential the blockchain technology has to revolutionize all existing industries. With its options of transparency, data security, compliance, logistics and process simplification, Blockchain stands as a backbone of cryptocurrency. Therefore, it solely is sensible to embrace this technology wherever the business structure demands trust, secure data management and transparency.

The travel and tourism sector is fragmented and complex. It faces numerous challenges in relation to finance, operations and also maintaining and protecting its customer base. Both ends of the travel chain, such as the tourists and the individuals providing travel, lodging or other services face various risks involved in the whole process. While some challenges are regarding, a few can become an opportunity for growth if tackled wisely. Using blockchain technology in the travel industry is an opportunity to overcome some of the major challenges faced by the industry.

Complexity and Human Error

The travel documentation systems currently in place are very complicated. To begin with, information is held in multiple databases (travel agencies, airlines, nation states), a situation which in itself defeats the concept of a single version of the truth. Furthermore, the permissions that travel documents confer are complicated and frequently vary based on the owner’s nationality and the rules of the destination country. To cite one typical example, the rules for entering the Netherlands are entirely different for Irish, Australian, French and Austrian citizens.

To make matters worse, these complicated rules are administered by check-in personnel who work under constant time pressure to keep flights on schedule, and who have no forensic training in identifying fraudulent documents. Even some legitimate documents that seem valid are not. For example, a passenger may present a one-time visa that’s already been used.

The best system for managing international travel documentation would be supported by info. Beyond basic functionality, the key challenge to such a system would be ensuring trustworthiness among participant members who might not trust one another—an inevitable consequence of world politics as they are today.

Blockchain technology is ideal for achieving this goal.

Tourism as an industry is currently run by third party websites and travel agents, who hold a huge chunk of private data from its clients, this information is bound to be at risk and exposure, with the implementation of blockchain technology the risk factor will be reduced as it uses encrypted keys for access to information by authorized personnel only.

Another important sector of tourism which will be affected by blockchain is how tourists abroad pay and expend money using cryptocurrencies. However, there is much more that can be done on an operational level that could favour the tourism industry from both a traveller’s perspective and from an industry perspective. These changes will take time and have its share of the hindrance, like the law and regulations in different countries and implementation of the same, but more so it has a lot of advantages.


Blockchain-based tourism apps are no doubt a winning investment. They have the potential to propel travel service providers to the forefront, building trust with customers, and imbibing a transparent, technology-based solution in the industry. Parangat Technologies is a leading blockchain app development company, with a stellar record of producing apps that are technologically-sound and financially-rewarding. Subject matter experts from the travel industry work hand-in-hand with the design and development crew to identify genuine bottlenecks in the industry. Get in touch with our sales team on for a free quote on your next travel app.

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About the author
Sahil GuptaCEO at Parangat Technologies

With roll up the sleeves, dive in and get the job done approach, it was year in the year 2010 when Sahil started Parangat Technologies. Emphasizing on a healthy work culture and technology driven company, he has successfully created a workplace where...

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