Decentralizing Supply Chain Anti-Counterfeiting Systems Using Blockchain Technology

Abstract

An interesting research problem in supply chain industry is evaluating and determining provenance of physical goodsdemonstrating authenticity of luxury goods such as bottled wine. Yet, there has been a few innovative software solutions addressing product anti-counterfeiting and record provenance of today's goods that are produced and transported in complex, inter-organizational, and often internationally spanning supply chain networks. However, these supply chain systems and networks have been built and implemented with centralized system architecture, relying on centralized authorities or any form of intermediaries, and leading to issues such as single-point processing, storage and failure, which could be susceptible to malicious modifications of product records or various potential attacks to system components by dishonest participant nodes traversing along the supply chain. Blockchain technology has evolved from being merely a decentralized, distributed and immutable ledger of cryptocurrency transactions to a programmable interactive environment for building decentralized and reliable applications addressing different use cases and existing problems in the world. In this research, the Decentralized NFC-enabled Anti-counterfeiting System (dNAS) is proposed and developed, decentralizing a legacy anti-counterfeiting system of supply chain industry using Blockchain technology, to facilitate trustworthy data provenance retrieval, verification and management, as well as strengthening capability of product anti-counterfeiting in wine industry with capacity to further extend to supply chain industry as a whole. The proposed dNAS utilizes decentralized blockchain network on a consensus protocol compatible with the concept of enterprise consortium, programmable smart contracts and a distributed file storage system to develop a secure and immutable scientific data provenance tracking and management platform on which provenance records, providing compelling properties on data integrity of luxurious goods, are recorded, verified and validated automatically.

An Empirical Analysis of Implementing Enterprise Blockchain Protocols in Supply Chain Anti-Counterfeiting and Traceability

“…Integration tests are also covered between different system components, such as blockchain service and app-backend service on its integration involving endpoint invocations of the blockchain service instance. Good test coverage of blockchain service could demonstrate the assurance on functions developed in different software components do define and execute as expected according to those operations explained in the system implementation of dNAS described in [9].…”

“…Instead of developing blockchain implementations based on conceptual design, decentralizing legacy anti-counterfeiting systems with centralized architecture already implemented in the industry, further with blockchain innovations integrated with, would be a more pragmatic way to start with. As such, the Decentralized NFC-Enabled Anti-Counterfeiting System (dNAS) is developed, as depicted in [9], utilizing decentralized blockchain network with enterprise blockchain protocols compatible with the concept of enterprise consortium, programmable smart contracts and a distributed file storage system to develop a secure and immutable scientific data provenance tracking and management platform, so as to provide timely support to improve the snowballing situation of product counterfeits in supply chain industry.…”

“…The Fig. 2: System Architecture Diagram of dNAS system implementation is generally categorized into two phases, as demonstrated in [9], namely the initialization phase and the data processing phase, covering system implementations ranging from consortium formation, smart contract deployment to wine record management on dNAS. The initialization phase includes all the necessary system implementation steps needed to be in place before dNAS can be fully functional for wine record management when wine products moving along the supply chain.…”

“…The hybrid approach of dNAS is a starting point for newly joined registered nodes to enjoy benefits suggested in dNAS and is more of an incremental way for any registered node in wine industry to eventually adopt the fully decentralized and distributed approach. The hybrid approach is therefore adopted for development of dNAS depicted in [9].…”

“…Instead of conducting a complete architecture overhaul and having every consortium member (registered nodes of wine consumer role are not part of the consortium as mentioned in the use-case analysis performed in [9]) hosting their own instance of dNAS, every registered node will go through use cases of registered node account management developed in AccountController of the app-backend service, to login and perform system operations on wine records, enabled by the dNAS instances hosted by the consortium, via a trustful governing authority which is the consortium administrator.…”