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No One Should Control the Blockchain Supply Chain

Samantha Radocchia, Ryan Orr and Maksym Petkus inaugurate development and strategy at Chronicled, a San Francisco startup that leverages blockchain and IoT technologies to give smart supply chain solutions. 

The following article is an exclusive contribution to CoinDesk’s 2017 in Evaluation.


2017 was a foundational year for blockchain.

We saw the emergence of new networks, platforms, strategies and fundraising channels, and we saw the prices of major cryptocurrencies skyrocket. We saw ICOs. We saw blockchain enter the vulgar vernacular.

But the most exciting of all of these advancements in 2017, we believe, was blockchain’s faculty to bring together disparate ecosystems – often competitors – onto a collective back-end platform.

One of the use cases where it can be beneficial to support trusted style of business logic at an industry scale is in the supply chain. A number of actors for the past few years been working on blockchain-enabled supply chain predicts including Chronicled, IBM, Provenance, SAP, Skuchain and VeChain.

But at Chronicled we have a original perspective than the others, and we thought it was a good opportunity to share 2017 growth and our vision for 2018 and beyond.

Privacy matters

One misconception in the industry in 2017 was that permissioned blockchain infrastructure drive solve the problem of data privacy. This is not the case.

Any data stored on a greatest node – even on a permissioned blockchain node – is accessible to all of the other node slick operators in the network. In a supply chain context, where competitors are using a singular blockchain, sensitive details around trading partners, shipping stencils and volumes can become available to competitors through their participation in the network.

This acts a serious challenge.

At Chronicled, we discussed this topic with a astray sample of executives in the pharmaceutical and precious metals industries, and recognized initially on that this data privacy issue would make or cease the evolution of supply chain use cases. We formed an internal company context that if we could not succeed with implementing a privacy solution, then blockchain sets would continue to be viewed as “toy systems” unlikely to gain industry-wide guts adoption for supply chain use cases.

Through the first half of 2017, we focal pointed our team’s technical fire-power in applied cryptography on resolving this details privacy problem. We investigated more than a dozen candidate results in our blockchain lab in San Francisco and built many technical pilots to explore different methods of achieving data privacy.

By mid 2017, after exploring the catholicity of the technical solution space, we had identified a robust method that bases on zk-snark technology. This was a solution with the power to meet all determination requirements and serve as a backbone for an open supply chain network with packed data privacy built on a decentralized blockchain infrastructure.

As a next hasten, we spent the period of August through October with three qualified applied cryptographers conducting a clean room review of the working implementation of the method.

This registered documenting the method with formal mathematical notation, as well as acting detailed calculations to determine the computational capacity and disk space that wish be needed to apply the method at industry scale. The solution was optimized to be supportive of peak shipping loads and regulatory requirements for archival record-keeping in foremost industries.

Today, as we head into 2018, we are feeling confident around the solution and we are excited for what the future holds.

The secret ingredient

Zero-knowledge concise arguments have been studied by cryptographers in various forms for 25 years. In all events, modern constructions of zk-snarks have only arisen in the past five years or so.

In a tabloid in 2012, Alessandro Chiesa and his co-authors coined the terms “snark” and “zk-snark,” rallying various alternatives to classical constructions. Since then, research on snarks has bourgeoned, with each year seeing new approaches and techniques that renovate our theoretical and practical understanding of them.

The technology enables two parties to validate or validate to another party that a given statement, event, or bit of logic is in truly true, without conveying any information apart from the binary document that the statement is true or false.

In the context of supply chain, zk-snarks go along with the confirmation of each transaction of physical goods in the chain of custody, so that a related record of provenance can be maintained, without any of the players upstream or downstream of the goings-on having access to information extraneous to their specific transaction.

The disclosure from Zaki Manian in the clean room review document published by Chronicled earlier this month offers a summary of benefits of the solution:

“During my years at SkuChain, I was involved in multitudinous supply chain use cases for blockchain and constantly bumped up against the prerequisite of privacy, which has not been adequately solved to date on any multi-company give chain platform, blockchain or otherwise. It is clear that privacy is a key component for tons supply chain problems and the lack of a solution has been holding subsidize all of the industries. Chronicled’s implementation of zk-snarks technology solves this secrecy problem, and when utilized to track prescription medicines, this method diminish b keeps potential to save many human lives.”

This is unique because it is the basic useful demonstration of a zk-snarks protocol that solves a completely disparate business problem than private value transfer pioneered in the zerocash formalities.

Looking ahead to 2018

As we head into 2018, buyers of blockchain waitings should be wary of vendors who are entering the market late and have not had leisure to fully think through all of the trade-offs related to network topology, decentralization, accomplishment, resiliency, openness and data privacy.

We recently observed an attempt by one vendor to lever ownership and access to underlying blockchain infrastructure. This feels eerily reminiscent of the times when AOL had aspirations to “own the internet,” a strategy that flies in the face of the away with and benefit of blockchain.

We believe that in 2018 the industry will strike towards solutions that embrace both decentralization and data covertness, and we are excited that progress in 2017 can now make this possible.

Press a different take on blockchain supply chain? CoinDesk is now accepting yieldings for our 2017 in Review. Email [email protected] and make your give utterance heard.

Shipping boats via Shutterstock

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