Permission blockchain systems have the ability to offer visibility and improved data across supply chains. Common applications include documentation digitization and process streamlining, process transparency, authenticity and product provenance, and product traceability.
The worldwide counterfeit goods market is an issue that is worth billions of dollars, and the problem is only getting worse and worse. A considerable fraction of this number is due to fake luxury items, including well-known brands behind accessories, shoes, clothes, and handbags. A lot of people who end up buying counterfeit branded products are not typically aware that the items are fake. This may be because they have bought the products online via a reputable website.
Tracking product authenticity
In the supply chain systems of today, there is no simple way to track the authenticity and provenance of a product. Some of the more sophisticated centralized systems have used RFID technology, unique electronic product codes (EPC), and barcode to track products through the supply chain.
These systems, nevertheless, rely on centralized certificate authorities and centralized databases, and this means that they are insecure fundamentally because of their single failure points, which means they can end up being susceptible to insider fraud and cyberattacks.
Blockchain enables product tracking for authenticity and traceability
Immutable and decentralized blockchain systems enable product tracking to origin (traceability) and via every step of the supply chain, i.e. authenticity. Building on this foundation, numerous projects on the blockchain have already deployed decentralized apps.
Authena is one company that is leading the way when it comes to product traceability, as it has been set up for complex B2B and B2C environments, ensuring end-to-end traceability and anti-counterfeiting so that business owners can operate with confidence. Too many manufacturers and companies today are plagued with counterfeiting and traceability, yet solutions like Authena are offering an answer to this.
Such an approach is going to track the product or the components of the product through every part of the chain, for instance, via an embedded NFC or RFID chip. At every step within the chain, the RFID chip is read, and then a smart contract will be executed. After this, a number of trusted nodes will verify the data is correct prior to it being written in the blockchain ledger.
Every entry within the blockchain ledger is going to be signed cryptographically, and encrypted, which means that fraud is deterred and the chances of hacking are also lowered.
Because the full supply chain process ends up becoming transparent, it means it is possible to inexpensively and quickly validate the authenticity of a product. Any product that does not enable dApp-based authenticity then becomes suspect, which will disincentivize fraud.
All in all, with product fraud being such a huge problem today, it is great to see that there are solutions being developed on the blockchain to help with product authentication.