GM-Ledger: Blockchain-Based Certificate Authentication for International Food Trade
Abstract
:1. Introduction
- Risk mitigation. By offering a safe and impenetrable method to track and confirm the authenticity of food products as they move through the supply chain, blockchain technology can help reduce the risk associated with file signing and document traceability in the food system. A blockchain-based system can verify that documents and files related to a food product that have not been tampered with by using digital signatures. Additionally, by recording all transactions and changes to a product’s status on the blockchain, it is possible to trace the product’s path from farm to consumer. Additionally, the blockchain can offer a secure, decentralized method for various actors in the food supply chain to share and access information about a product. This can help to increase transparency and trust between supply chain participants.
- Dramatically reduces transaction costs and time. Instead of relying on a centralized authority or middleman, a blockchain-based system enables a decentralized network of participants to access and share information about a food product. This can lower the price of using intermediaries and lessen the need for coordination and communication among various supply chain participants.
- Improved asset authenticity verification. Blockchain technology can offer a transparent and unchangeable record of a food product’s entire supply chain journey. This may lessen the requirement for costly and time-consuming inspections and audits. Blockchains are an amalgamation of four security features: hash functions, public–private key encryption, consensus algorithms and smart contracts.
- Decreased fraud and compliance costs. A blockchain-based system can use digital signatures to guarantee that documents and files related to a food product have not been tampered with, which can help identify and stop fraudulent activities. A tamper-proof record of all transactions and modifications to a food product’s status is produced by blockchain technology. This can aid in the detection and prevention of dishonest practices like the falsification of documents or the mislabeling of goods.
- New financing opportunities. Through the use of various techniques like smart contracts, tokenization, supply chain finance, trade finance, crowdfunding and automation, blockchain technology can provide new financing opportunities in the contemporary supply chain. By automating the payment process, these methods can increase supply chain efficiency and financing opportunities while reducing intermediaries and financing costs. They can also improve access to capital for SMEs and provide new ways to raise capital and create liquidity.
- Decreased risk and increased document trade facilities. Systems for tracking food products as they move through the supply chain that are based on blockchain technology may offer a more precise and effective method. As a result, product recall costs can be decreased and problem detection and resolution times can be sped up. Blockchain-based systems can offer an unambiguous and auditable record of every transaction, which can help to ensure compliance with legal requirements and cut down on the expense of compliance audits.
- Simple, secure data sharing between institutions. The supply chain can be made more efficient overall if blockchain technology is used to enable real-time access to the same information by multiple parties. This can help with coordination and cut down on errors. A key component of blockchain technology is consensus algorithms. They are used to make sure that new transactions are valid and that everyone in a blockchain network agrees on the ledger’s current state.
Role of Certifications in the Food System
2. Literature Review
“The blockchain innovation really allows us to take everything where there’s record keeping, everything where there’s trust around record keeping, and it allows us to make that digital, immutable, permanent, and global.” [6]- Jeremy Allaire
2.1. Types of Blockchain Networks
2.1.1. Permissionless Blockchains
2.1.2. Public Blockchains
2.1.3. Permissioned Blockchains
2.1.4. Private Blockchains
2.1.5. Consortium Blockchains
2.1.6. Hybrid Blockchains
2.2. Major Features of Blockchain Technology
2.3. Blockchain and Food Supply Chains
2.4. Tokenization of Assets
3. Methodology
Survey of the Similar Literature
Paper(s) | Content Analysis | Similar Publications |
---|---|---|
SmartOil [33] | Oil and Gas Data Processing | Review [36] |
CertificateChain [34] | Healthcare Certificate Management | Medical Certificate [35], BHEEM [37] |
Landchain [38] | Land Certificate Management | [39,40,41] |
B-Cert [42] | Academic Certificate Distribution | Education Certificates [43] |
TuDocChain [44] | Securing Digital Academic Certificates | Academic Certificates [45] |
Halal Food Certification [46] | Authenticating Halal Food Certificate | Fish Industry [47], Palm Oil [48], Olive Oil [49] |
Digital Medical Passport [50] | COVID-19 Vaccine and Immunity Certificates, Health Passports | Vaccine Certificates [51,52], NovidChain [53] |
Gemiverse [54] | Certificate Management in Travel Industry | Tourism [55] |
Decauth [56] | Decentralized Authentication Scheme for IoT Devices | Bubbles of Trust [57], A2 Chain [58] |
Internet of Forensic (IoF) [59] | Digital Forensics | [60,61], B-coc [62], ForensiBlock [63] |
CoC [64], CustodyBlock [65] | Chain of Custody of Goods Along Various Supply Chains | [66], B-Dec [67], TrueCert [68] |
VANGUARD [69] | Managing Media Rights and Copyrights | [70,71], Music [72], MF-ledger [73] |
GM-Ledger (Our Study) | Cross-Border Food Certificate Authentication for Global Maritime Trade | First study to employ BCT in international food trade |
4. Present System of Document Processing
4.1. Requirement of Various Players in the Food System
4.1.1. The Requirement of Food Importers and Exporters
4.1.2. The Requirement of Freight Forwarders
4.1.3. Port Customs Requirements
4.1.4. The Role of National Regulators
4.1.5. The Role of Insurance Providers
- Insurance companies can cover damage or loss to cargo that occurs during transportation, such as that caused by inclement weather or ship mechanical issues.
- Insurance providers can offer coverage for any third-party claims that may result from the import or export of food products, such as if a product is discovered to be contaminated or if a consumer experiences an allergic reaction.
- Insurance companies can cover any delays or interruptions that may happen during transportation, such as when a ship is held in port because of a quarantine or when it is delayed by bad weather.
- Insurance companies can offer coverage for any damage or loss that may result from war or strikes, which can obstruct the movement of goods.
- Additionally, insurance companies may offer coverage for the food items both during transit to and from the destination, as well as during warehousing and storage there.
4.2. Document Processing Model
- The importer identifies potential food products to import and reaches out to the exporter to negotiate terms of trade.
- The exporter provides the necessary documentation and certifications required by the importing country’s regulations.
- The importer arranges for a freight forwarder to handle the logistics of exporting the products, including booking shipping and customs clearance.
- Exporters ship the products to the importer’s designated port of entry.
- The freight forwarder handles customs clearance and arranges for transport to the importer’s facility.
- Regulators, including government ministries and International Food Standards documents, have to be verified.
- Importers conduct necessary inspections and obtain any required permits or licenses from regulatory agencies.
- The importer arranges for insurance coverage for the products.
- The importer distributes the products to retailers or wholesalers.
5. Proposed Document Processing Procedure Using Blockchain Technology
Proposed Blockchain Solution Architecture
- The top layer of the Ethereum Blockchain is called the application layer, and it is here that users interact with decentralized applications (dApps) and smart contracts. User input management and the presentation of smart contract execution results are handled by the application layer.
- The contract layer is in charge of carrying out smart contracts. Smart contracts are self-executing agreements in which the terms are directly written into the program code. A contract can be automatically executed by the network once it has been deployed on the Ethereum Blockchain.
- The message layer is in charge of managing the dialogue between the application and contract layers. The input is transferred from the application layer to the contract layer, and the output is transferred back to the application layer for display.
- The integrity and security of the network are upheld by the consensus (or blockchain) layer, which is the foundational layer of the Ethereum Blockchain. It is in charge of maintaining the distributed ledger and using consensus algorithms to confirm and validate transactions. It is responsible for verifying and validating transactions and for maintaining the distributed ledger.
- The P2P/data network layer is in charge of the upkeep of the network infrastructure supporting the Ethereum Blockchain. It is in charge of propagating new blocks to all network nodes and the upkeep of the peer-to-peer network that underpins the Ethereum Blockchain. This is the bottom layer of the blockchain and is responsible for storing and managing the data that are recorded on the blockchain.
- A procedure for tracking down content and organizing delivery from one location to another.
- A file system that can be mounted locally so that remote resources can be accessed as if they were local.
- A modular method for thinking about network operations like virtual circuits and routing.
- File transfers between peers that do not require servers.
- A global namespace built on the Public Key Infrastructure (PKI).
- A method for maintaining the consistency and version control of files.
- An upgrade path for browsers so you can access information using the new way (ipfs://) or the old way (http://).
6. Smart Contract Design
7. Results
7.1. Advantages of Tokenization for Players
7.2. Advantages of Asset Tokenization from the Viewpoint of Investors
7.3. Role of Blockchains in the Future of Supply Chains
- Organizations’ adoption of the blockchain is still not fully understood. When they are fully integrated into an organization’s system, blockchains typically shine the brightest. Organizations’ need to address compatibility issues may increase as the number of off-chain components increases. Since this is challenging to accomplish, it is preferable to start with a specific area, like certification transparency.
- Both data quality and immutability are crucial. The blockchain is unique among data processing technologies due to the immutability of the data. But, data entered into supply chains are frequently inaccurate because people make mistakes. Every data-related action is treated as a transaction on a blockchain. On a blockchain, data can only be updated; it cannot be fixed traditionally. Organizations will need to process more transactions and expend more resources processing more updates, which will result in more transactions.
- Giving the appropriate people access to data. Granular granting of data access rights is one method of addressing the prior problem. Sharing crucial data with the appropriate parties and in the appropriate situations is crucial to preventing data leaks and monetary losses. Organizations should decide on various levels of data confidentiality to ensure that no unauthorized users, including third parties, will access information they are not supposed to. Each user of an organization’s supply chain management system can be given a specific role with corresponding access rights.
- Develop this architecture in the correct way. Building a blockchain-based supply chain management solution typically takes one of three common approaches:
- Make use of an established global platform. Because they have been extensively tested by a large number of users, large, well-known blockchain platforms are typically trustworthy. A ready-to-use platform, however, might offer few opportunities for customization and necessitate substantial changes to an organization’s current system.
- Make use of a public blockchain that has smart contracts. Making a smart contract-based solution that meets an organization’s needs is a fairly simple process. Public blockchains that are widely used support smart contracts, however, they may be too slow or expensive for supply chain tasks.
- Create a unique network. A customized blockchain network can operate flawlessly, fit a business’s existing system perfectly and have affordable transaction processing costs. However, creating such a solution requires a high level of expertise, careful planning and extra work.
- Several parties, including producers, suppliers, merchants and final consumers, are linked by supply chains. As a result, they rely on a variety of tools, including tracking systems, management software and Enterprise Resource Planning (ERP) systems. Using all of these tools to integrate a blockchain platform can be very difficult. In the first place, not all third-party programs and systems support blockchain technology. The architecture of an organization’s solution, including all of the Application Programming Interfaces (APIs), containers and micro-services an organization employs, has to be properly thought out. Organizations should give their full attention to the security of data, both in transit and at rest. Second, it is possible that not all of an organization’s suppliers, partners and customers would agree to utilize its platform if it employs blockchain technology. They could be concerned about anything from system integration costs to data security issues while using a shared environment. As can be seen, despite their many benefits, supply chains built on blockchain are not that straightforward to put up. Organizations may fully enjoy the advantages of blockchain-powered supply chain management by taking the aforementioned difficulties into consideration and carefully organizing their operations.
- Blockchains must be connected to IoT devices to guarantee smooth feedback and prevent data manipulation. But, blockchain’s lack of scalability is the issue. Particularly, it is known that, in their present forms, public blockchains, like Bitcoin and Ethereum, process between about 7 and 25 transactions per second on average. Due to the proof of work, these public blockchains have distributed consensus requirements by design, which makes them fatigued and concurrency-limited. As a result, public blockchains stamp micro-transactions with exorbitantly high levels of fees. For a USD 1–2 transaction, the median fee at the time of writing was 34% for Bitcoin and 8% for Ethereum [89].
8. Future Works
8.1. Network Architecture
8.2. Complete Blockchain-Based Tokenization of Food Supply Chains
8.3. Roadmap for Developing Human Capacity
9. Conclusions
Author Contributions
Funding
Data Availability Statement
Acknowledgments
Conflicts of Interest
Abbreviations
BCT | blockchain technology |
DLT | distributed ledger technology |
EWF | energy water food |
IT | information technology |
MoCI | Ministry of Commerce and Industry |
MoME | Ministry of Municipality and Environment |
MoPH | Ministry of Public Health |
MoTC | Ministry of Transportation and Communication |
NGO | Non-Governmental Organization |
Appendix A
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Value Created | Type of Blockchain | Blockchain Network | Reference |
---|---|---|---|
Traceability of food | Permissioned—private | Hyperledger Fabric | [15] |
Consensus toward buyer–seller match making | Permission less—public | Ethereum Network | [16] |
Developed three algorithms for better management of the FSC | Hybrid AWS | Ethereum Blockchain | [17] |
Detailed information about the different blockchain networks | Permissioned—consortium | Hyperledger Sawtooth and Fabric | [18] |
Conducts feasibility study of blockchain adoption for food safety | Permission less—public | Ethereum Network | [19] |
Fungible | Non-Fungible | |
---|---|---|
Interchangeability | Interchangeable: A token can be exchanged to any other token of the same type. | Not Interchangeable: Non-fungible tokens cannot be replaced with another non-fungible token of the same type. |
Nature | Uniform: All tokens of the same type are identical in specification, each token is identical to another. | Unique: Each token is unique and different to all the other tokens of the same type. |
Divisibility | Divisible: Fungible tokens are divisible into smaller units, and it doesn’t matter which units you get as long as the value is the same. | Non-divisible: Non-fungible tokens cannot be divided. The elementary unit is one token and one token only. |
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© 2023 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https://creativecommons.org/licenses/by/4.0/).
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George, W.; Al-Ansari, T. GM-Ledger: Blockchain-Based Certificate Authentication for International Food Trade. Foods 2023, 12, 3914. https://doi.org/10.3390/foods12213914
George W, Al-Ansari T. GM-Ledger: Blockchain-Based Certificate Authentication for International Food Trade. Foods. 2023; 12(21):3914. https://doi.org/10.3390/foods12213914
Chicago/Turabian StyleGeorge, William, and Tareq Al-Ansari. 2023. "GM-Ledger: Blockchain-Based Certificate Authentication for International Food Trade" Foods 12, no. 21: 3914. https://doi.org/10.3390/foods12213914
APA StyleGeorge, W., & Al-Ansari, T. (2023). GM-Ledger: Blockchain-Based Certificate Authentication for International Food Trade. Foods, 12(21), 3914. https://doi.org/10.3390/foods12213914