How to secure a supply chain from counterfeiting and theft with digital certificates
The supply chain represents all the links involved in creating and distributing goods, from raw materials to the finished product. Customers and buyers have no reliable way to verify and validate the true value of the products and services they purchase because of the lack of transparency across the supply chain.
As a distributed ledger that ensures both transparency and security, the blockchain is a low cost to serve solution to fix the current problems of the supply chain. The public availability and decentralized structure of a immutable ledger makes it possible to trace back every product.
What makes Quasar so special?
Quasar is a blockchain ledger with a compliance layer on top of it. The compliance layer validates for every transaction if it is complies with a set of rules. These rules can be defined with QuBIC, the Quasar Business Intelligence Center. QuBIC allows users to create their own type of wallets (=participants in the supply chain) and assign additional rules for receiving and sending of digital certificates. Read “Building Virtual Private Payment Networks with the Quasar Business Intelligence Center” for further information about QuBIC.
In the example below, four different types of wallets are defined in QuBIC.
1. The manufacturer wallet. Wallets of type Manufacturer have the right to create a certificate on the Quasar ledger and send this certificate to a wallet of type “Distributor”. The certificate can include information like a (hashed) serial number.
2. The distributor wallet in return may accept certificates from manufacturers. In case of a defect, not only the product but also the certificate can be returned to the manufacturer. The distributor can send and receive certificates to and from wallets of type “End User”.
3. End User wallets may accept certificates from a distributor wallet and from other End User wallets. In case of a defect, the product and the certificate can be returned to the distributor.
4. At the end of the product life cycle the physical product will be demolished. Because entities on a blockchain can not be deleted, the certificate must be send to a Cemetery wallet. Even in the case the product is not physically demolished, anyone can see that it has reached the end of life cycle. Manufacturers can directly send certificates for broken products to the Cemetery wallet. The cemetery guarantees that a certificate will not be re-used with a fake product.
Authorities and Insurers
The blockchain ledger is immutable and transparent. All participants in the supply chain can view the history of a certificate. Of course this immutable information is also valuable i.e. for authorities and insurers. Not only to check if the conditions of the insurance policy are met in case of an accident, but also in case of theft; the policy holder transfers the certificate to the insurers’ wallet before the claim for compensation will be paid.
Publishing certificates on the Quasar blockchain ledger also reduces counterfeiting. If an organization has a certificate but not the product everyone else thinks this organization has the product; this is of course an unwanted situation, especially when the certificate deals with sensitive products that can be used for criminal activities.
If an organization has a product but without a certificate it is very likely that one has a counterfeiting or stolen product.
3D printing and certificates
In the future, instead of delivering the final product, manufacturers will increasingly deliver a 3D printing instruction set to the end user. Advantages are, reduced (capital binding) stock, faster delivery without distributors.
Digital certificates are an effective way to avoid the risk of illegal copies when distributing digital print instruction sets, because they can not be duplicated.
Furthermore the blockchain transaction can include an encrypted message (i.e. including password and checksum of a zipped printing instruction set) that only sender (manufacturer) and receiver (end user) can read. This message guarantees authentication and data integrity of the printing instruction set.