For Supply Chain sustainability has become a necessity and so for Blockchain sustainability is a growing issue. Blockchain and sustainability have long been discussed, because cryptocurrencies like Bitcoin are not exactly known to be environmentally-friendly.

Nevertheless, it is possible to build sustainable Blockchain solutions – like in our case. Our Blockchain application ivault is highly scalable and sustainable. Read more about this explosive topic here.

Blockchain German Supply Chain Act White Paper

The New Supply Chain Act and Blockchain Technology [I]

White Paper for Businesses

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From January 1, 2023, Germany’s new Supply Chain Act obliges companies to protect human rights in global supply chains. However, the law does not provide the technical solution needed for the seamless monitoring of thousands of suppliers worldwide.

Implementing the requirements calls for full supply chain transparency. Thus, this topic is of enormous importance for ivault as Blockchain Technology offers one of the best solutions to this challenge, ensuring transparency, security, and LkSG compliance.

Apart from that, advanced applications based on environmentally-friendly Blockchain Supply Chain solutions like ours can boost the Circular Economy. For more insights, please see our White Paper on the new Supply Chain Act and Blockchain Technology at the end of this post. Or watch the German interview with CEO Arman Sarhaddar below.

New Supply Chain Act in Germany 

10 questions and answers on the new law

1. What is the Supply Chain Act supposed to do? 

Every day, we consume products manufactured all around the globe: Coffee and chocolate, clothing, sporting goods, and electronics. All of this creates prosperity for us while people in global supply chains often work under miserable conditions. Even some of our favorite brands’ suppliers frequently disregard fundamental human rights, such as the prohibition of child labor.  

On January 1, 2023, the Act on Corporate Due Diligence Obligations in Supply Chains (Lieferkettensorgfaltspflichtengesetz, LkSG), often referred to as Supply Chain Act, will come into force in Germany. It intends to initiate the long-needed improvement of fundamental social standards and human rights in global supply chains, and it has enormous implications:

The new law covers large German corporations and affects small companies that act as their suppliers – SMEs both from Germany and abroad. The European Union is in the legislation process at the same time. All member states of the EU will eventually enshrine the EU supply chain directive nationally. As a result, the decisions also affect non-EU corporations, such as Swiss or American companies operating in EU countries.  

High fines will soon follow if the implementation is missing or incomplete – even though the requirements for companies are tremendous and meeting the needs seems anything but easy…

EU Supply Chain Act Human Rights syfeguarded by the German LkSG

Human rights — Standards that will be safeguarded by corporate due diligence obligations as defined by the German Supply Chain Act, coming into force on January 1, 2023.

2. Why do we need a Supply Chain Act in the EU?

In 2016, the German government published the National Action Plan (NAP) based on the Guiding Principles on Business and Human Rights. The expectation was that at least 50% of companies with 500+ employees would voluntarily implement the proposal.

However, only 13-17 % followed the NAP recommendations voluntarily. So, in line with the coalition agreement, the German government took legislative action. The result is the new Supply Chain Act, which ties in with the EU directive. 

But why did only a few companies voluntarily commit themselves to adopting the NAP suggestions? Was it the sole pursuit of the most significant profit possible – not only at the expense of people and the environment but also at their reputation? Aren’t there any other reasons?

It can be said with some certainty that the challenge companies continue to face is no small one. For a critical review of the Supply Chain Act see our White Paper below.

Blockchain Supply Chain Act White Paper: facts and figures by BMZ, Germany

New supply chain law in Germany: Fact and Figures by the BMZ in the White Paper Blockchain and the New Supply Chain Act in Germany 2023/2024 by Vault Security Systems AG.

 

3. What applies from when and which companies are affected?

The LkSG in Germany covers both companies headquartered in Germany and companies with a branch office in Germany:

  • From 01.01.2023: Companies with 3,000+ employees
  • From 01.01.2024: Companies with 1,000+ employees

As the LkSG is a transitional law, it is still unclear exactly how things will continue in Germany after 2025. However, it can be beneficial for smaller companies to prepare for a solution as early as possible.

EU member states must implement the new requirements imposed by the EU supply chain directive within two years of its official adoption. It will cover both EU limited liability corporations and non-EU corporations operating in states of the EU generating sales, as displayed below. 

  • From 2023: Companies with 500+ employees and a net sale of 150+ Mio EURO per year
  • From 2025: Companies with 250+ employees and a net sale of 40+ Mio EURO per year operating in high-impact industries ( such as textiles, food, minerals, some chemicals, …)

4. How does the Supply Chain Act impact SMEs?

SMEs do not (yet) fall directly within the scope of the EU Directive and the LkSG. Nevertheless, the law can impact SMEs if they act as suppliers of the companies targeted. Corporations can, for example, require direct suppliers to implement due diligence processes. However, unlike buyers, suppliers do not have to expect sanctions imposed by the BAFA.  

To assist SMEs, the Federal Ministry for Economic Cooperation and Development offers the KMU Kompass – a new online tool that is anonymous and free of charge. It helps companies better understand social and environmental risks and establish LkSG-compliant processes. 

5. What does the Supply Chain Act demand? 

The German government demands fully traceable steps to demonstrate corporate social responsibility and safeguard human rights. It encompasses the enterprise’s business area as well as direct suppliers and – in some cases – indirect suppliers. 

The Act is also meant to ensure legal certainty for companies and fair conditions of competition in the global market. To this end, the due diligence requirements described in the LkSG, as summarized below, must be complied with. 

In addition, complete documentation should enable corresponding evidence. However, documentation systems can only clearly demonstrate a company’s LkSG compliance if they can prove that data has not been manipulated or falsified. 

This is one of the main arguments for using Blockchain Technology in the context of the Supply Chain Act, as it enables tamper-proof data storage while preventing irreversible data loss, as CEO Arman Sarhaddar mentioned in the interview above.

Part II of our series of articles on Blockchain and the Supply Chain Act will examine how the due diligence requirements listed below can be operationalized using Blockchain Technology.

6. What due diligence obligations are there?

Regarding their own business area, companies must comply with the following due diligence requirements:

  1. setting up a risk management system with clearly defined internal accountability,
  2. performing regular risk analyses,
  3. issuing a policy statement on corporate human rights strategy, 
  4. laying down preventive measures to avert human rights violations,
  5. taking remedial action immediately in the event of legal violations,
  6. establishing a complaints procedure for people in the supply chain, and
  7. continuous documentation and transparent public reporting

In the case of direct suppliers who act as contractual partners to companies, companies must take care of the following matters:

  • contractual assurance of suppliers to respect human rights
  • annual risk analysis and agreed control mechanisms
  • implementation of preventive and remedial measures
  • offer training and education

Due diligence obligations only apply to indirect suppliers who act as suppliers of the contractual partner if there is a specific reason for doing so. Then companies must:

  • conduct cause-related risk analyses
  • introduce concepts to end or minimize risks and violations.

7. What are the penalties for non-compliance with the LkSG?

In the event of negligent or intentional violations of the LkSG, companies must expect these sanctions:

  • Penalties and fines (see below)
  • the exclusion from public contracts

Additionally, human rights violations identified in a company’s supply chain through a risk-based inspection can cause aggravating reputational damage. Consequences like this can be more severe, especially if breaches have gone unnoticed for a long time. Restoring a brand image built up for decades likely costs much more than the penalties listed below. Furthermore, this can also affect the public appearance of other companies in a business relationship with the perpetrator, including SMEs.

8. How much can LkSG fines be?

Fines can be up to 2% of a company’s annual turnover if it records 400+ million EURO worldwide. In addition, the amount of fines depends on the individual case, the extent and duration of the breach of duty, and other variables. Section 24 of the LkSG includes

Blockchain & LkSG – German Supply Chain Act Fines and costs of corporate due diligence violations

Supply Chain Act fines and costs of corporate due diligence violations

 

9. Are companies liable for the conduct of their suppliers abroad?

The authority does not intend to provide a new basis for liability for the conduct of third parties in the supply chain. Companies only have to prove that they are making efforts to comply with due diligence obligations, look at risks and grievances, prevent violations, and take remedial actions. However, the LkSG does not affect or change existing liability bases. Lastly, terminating a business relationship with a direct supplier is required if there is a severe violation or remedial measures remain ineffective.

10. How can Blockchain help comply with the Supply Chain Act?

There is an enormous need for action concerning supply chain transparency: supply chains include thousands of suppliers from many different countries and are becoming increasingly complex. As a result, many companies do not know whether raw materials are actually mined under acceptable conditions, whether employees receive fair wages or whether contaminated production waste is handled correctly. Let alone how to keep track of it. 

Still, the latest Supply Chain Act requires complete transparency. Hence it places high demands on the data management of the businesses affected directly and indirectly: From 2023, all data must be continuously collected, stored, analyzed, and made publicly available across all companies’ and countries’ boundaries. 

Distributed ledger technology, better known as Blockchain, offers one of the best solutions to this task. More precisely, the technology can be the basis for a wide variety of applications that cover a large part of the new requirements better than any other solution. However, what does the operationalization of due diligence obligations look like using a Blockchain platform? How does it help sustainability and corporate social responsibility?

In particular, in the context of the Supply Chain Act, a blockchain platform enables:

  1. seamless risk monitoring and tracking of the entire supply chain on a single but decentralized platform thanks to increased transparency,
  2. smooth coordination and management of prevention and remediation activities and other international business operations beyond the scope of the LkSG in real-time,
  3. the exchange of securely encrypted data and trust between all parties involved without an intermediary while the anonymity of users is guaranteed – especially when it comes to the complaints procedure,
  4. tamper-proof documentation of all processes and activities with immutable time stamps, as well as protection against irreversible data loss and thus also
  5. providing clear evidence of a company’s full compliance with the Supply Chain Act.

Automation of the underlying processes is easy. The company does not rely on installing, operating, and maintaining multiple, incompatible programs and applications. As a result, susceptibility to errors can be drastically reduced, and the company’s legal security is increased.

To find out exactly how to implement the legal requirements based on a customized Blockchain platform, read our White Paper on the use of Blockchain Technology in the context of the Supply Chain Act below. In the upcoming blog post, you will be provided with a summary of the benefits of Blockchain regarding LkSG compliance.

Subscribe to our Newsletter to be notified about new publications and developments.

 ___________

► Supply Chain Act & Blockchain (White Paper)

Do you need a customized Blockchain application to increase the legal security of your supply chain? We would be happy to advise you personally on the most cost-effective solution for your unique supply chain: Get in touch with us now.

The New Supply Chain Act and Blockchain Technology — White Paper Download

*includes a Blockchain use case for the Circular Economy and a checklist for evaluating Blockchain solution providers

 

White Paper on Blockchain and the new Supply Chain Act in Germany 2023 / 2024: Using Blockchain Technology for Global Supply Chain Transparency and Legal Security.

White Paper on Blockchain and the new Supply Chain Act in Germany 2023 / 2024: Using Blockchain Technology for Global Supply Chain Transparency and Legal Security.

from sustainable blockchain solutions for supply chain to social applications to benefit every single private citizen

CNN, Fox & more:
5 Ways to Use Blockchain for Social Impact and Global Change


Today, we are thrilled to announce: The ivault™ App is available on the Apple App Store and Google Play Store now. In the meantime, our educational commercial has been featured on Fox Business Network, CNN Headline News, and many others. Watch the video below and read about 5 ways we use Blockchain Technology for social change, environmental protection, and saving lives…

What is ivault and how does the ivault App work as a Social Network with its basic Lost & Found Platform to find lost items and help others.

From our anti-counterfeit packaging solution for businesses (and end customers to detect fake products) to the ivault™ App, a new lost & found app – based on a Blockchain Social Network concept that realizes the vision of using Blockchain for social impact to benefit local communities on a global scale. 

So, we can proudly say: Our flagship brand is a successful brand already.

But how did we get there? You will know after reading about these 5 things the ivault Blockchain can do to benefit society and make the world a better place:

  1. _ Saving lives.
  2. _ Increasing consumer safety.
  3. _ Helping sustainable development goals and green consumers.
  4. _ Tracking assets to prevent theft.
  5. _ Building a safe social engagement platform to find local help.

The ivault Blockchain explained on Fox, CNN and others

In September 2021, our short educational video about ivault aired nationally on Fox Business Network and CNN Headline News. We added the video below for you to watch right away.

ivault™ is a successful brand already.

However, a brand reputation like this poses requirements for any future-oriented company. It demands corporate efforts towards sustainability, environmental protection, and social responsibility.

Thus, we aim to use sustainable technology solutions based on Blockchain for social impact and the environment all around the globe. Below, you can read about the 5 things a “Social Blockchain” can be used for to make the world a better place.

For more information about our innovative product using Blockchain Technology for social change, visit ivault.app. Or try it yourself: ivault is available on the Apple App Store and Google Play Store now.

Using Blockchain for Social Impact

— What is “Blockchain for Social Impact”?

The term “Blockchain for Social Impact” was coined by the Blockchain for Social Impact Coalition (BSIC). Their mission is to incubate, develop, and implement blockchain solutions that can address social and environmental challenges across the UN’s Sustainable Development Goals (SDGs).

Now, we want to show you

  • why we use Blockchain for social impact,
  • how distributed ledgers can actually benefit society, and
  • what it means to use Blockchain to drive social change.

— Why use Blockchain for social impact?

First of all, we want to address social challenges because, in our opinion, every company nowadays has to take social and ecological responsibilities. To actively help the environment is a major necessity in modern economics and technological innovation.

It is no secret that companies usually want to make money. But some exclusively try to make as much of a profit as they can. Without caring for our planet or fellow human beings. These businesses are, for example, the counterfeiters we are trying to fight
— with distributed ledger technologies.

Secondly, distributed ledger technology, better known as Blockchain, is one of the most secure and powerful technologies available today. Unfortunately, it has not yet been used to its full potential.

That is what we want to change
— with ivault.

Beyond that, luckily, we are not alone. Some companies are already testing blockchain prototypes for future applications to benefit the health and well-being of people. Then, of course, there are similar projects with other promising future projects like Google’s program AI for Social Good.

Now, it’s time to get to the heart of things and discuss, what it really means to use Blockchain for social impact. We are going to show you, how we are using the ivault Blockchain for social impact. Some of the following track & trace solutions for B2B are already on market.

How to use Blockchain for social impact

Here are 5 things Blockchain can be used for to benefit society, boost social change and help the environment:

1. Saving lives.

With Blockchain as an anti-counterfeiting technology.

What type of technology saves lives? Without the heading that suggests “Blockchain as an anti-counterfeiting technology,” you would presumably first think of some medical devices. Likewise, security technology can save lives — another basic answer to the question above.

Blockchain or Distributed Ledger Technology (DLT) has rarely been described as a technology that saves lives. Yet, it is one of the best security technologies we have.

And we can also use it to store health records safely or enhance medicinal technologies in different ways. In our case, for example, to prevent theft and fight counterfeit products that cause millions of deaths each year all around the globe. Especially, in the pharmaceutical industry.

By making it much easier to detect and prevent counterfeit and stolen goods in the supply chain, Blockchain Technology as an anti-counterfeiting solution can reduce the number of deaths by counterfeit drugs and, thus, save many MANY lives.

Here is one of our most illustrative blockchain use cases for pharma that will have a massive environmental and social impact all around the globe.

► Anti-counterfeiting pharmaceuticals

Counterfeit drugs can cause substantial damage, not just to a company’s reputation.

When it comes to the pharma supply chain, Blockchain Technology can be used to track pharmaceutical products and third-party ingredients more efficiently than ever.

In order to track products, we use a special blockchain design to store a digital twin of products. Products are then integrated with unique physical identifiers and modern tracking technology like QR, NFC, RFID, or GPS trackers to identify and track assets.

We are using supply chain solutions to combat counterfeit products in the pharmaceutical supply chain.

Essentially, what prevents death by counterfeit drugs is supply chain transparency and some way for the consumer to check a product’s authenticity before use.

Use case: Blockchain as anti-counterfeiting technology for the pharma industry

Use case: Blockchain as anti-counterfeiting technology for the pharma industry reducing the number of deaths caused by fake prescription drugs.

 

Our blockchain solutions enable the end customers to detect fake drugs themselves by scanning the ivault.verified anti-counterfeit label on a product’s packaging.

If it is an original it is easy to verify product authenticity and the consumer can be sure that a product is really safe to use.

This simple act can not only save lives, but also brand reputation.

► Preventing deaths by other counterfeit goods

We are currently focusing on blockchain solutions in pharma as fake drugs are a major global threat to humankind.
Of course, it is not only fake medicine, posing serious health threats and causing fatal incidences. Almost every industry desperately needs better anti-counterfeiting technologies. Other examples of dangerous counterfeit goods you might not think of in the first place:

That is why we want to take anti-counterfeiting technologies to the next level and provide solutions that are accessible and easy to use for your end customers as well.

2. Increasing consumer safety.

By increasing supply chain transparency and protecting products.

Successful companies want brand protection. That is a considerable market as traditional logistics and data management systems still fail to ward off counterfeit and pirated products.
 Increased supply chain transparency and security make it much easier to detect and prevent fakes and stolen goods from entering the supply chain.

However, DLT-solutions for businesses — like ivault — not only protect brands and secure supply chains. Blockchain can also enhance the safety of consumer products of any kind.

How? Product authenticity can be monitored and verified throughout the production — from third-party suppliers’ parts to the end consumer, including those who buy a product second-hand (or even third-hand). Supply chain managers can check the authenticity of parts and ingredients much like the end customer as described above.

By implication, increased product safety also means improved consumer safety which benefits society globally.

Nevertheless, trademark protection is by no means secondary. Here is an outraging story that shows: Better brand protection solutions (even for luxury goods!) benefits society globally — by fighting organized crime that is potentially funding other criminal activities:

► TED Talk: Counterfeiting handbags is not a victimless crime

The end customers — an essential part of the supply chain — are affected much worse by cheap and harmful imitations like faulty car parts or fake drugs. While large corporations make “only a few billion in loss,“ consumers may have to pay with their lives.

That makes it understandably hard for people to feel pity for big companies suffering from brand counterfeiting but still making loads of money. 
Many people would still be glad to find a good Gucci fake on vacation.

But, as counterfeit investigator Alastair Gray states in a TED Talk (How fake handbags fund terrorism and organized crime):

“Counterfeiting is not a victimless crime.”

Even in the case of counterfeit fashion accessories, like the seemingly innocent fake handbags at the beach…

ivault enables anyone with a smartphone to become a counterfeit investigator for their favorite brand or company. Consumers can scan QR-Codes printed on the ivault.verified anti-counterfeit label on the product packaging.

Embedded NFC chips are even safer and can be fully hidden inside a product or its packaging. Scanning an ivault.verified product with an NFC chip reader app still works very well even with metal objects.

3. Helping people live a more sustainable life

By providing verified data about green products. 

Nowadays, sustainability is an enormous and growing competitive advantage for companies. The modern consumer is concerned with the sustainability of products and manufacturing conditions, from organic food to fair trade fashion. To comply with Sustainable Development Goals (SDGs) is becoming more important for brand trust.

Now, Blockchain can guarantee product authenticity and provide verified data about original products, as mentioned above, through a simple QR scan with any smartphone to get more information about the green products, like sustainability certificates, stored on the blockchain.

This way, as a green company, you can create a new customer experience for those who care for the environment. To help consumers live a more sustainable life and build trust in your brand and products. Here is another example of a startup company that attempts to track sustainably caught fish — an excellent explanation of how blockchain tracking works and how it can contribute to a greener economy.

► TED Talk: Blockchain for fish tracking

Supply chain innovator Markus Mutz discusses a fish tracking use case using Blockchain very well. His startup company OpenSC and WWF are developing a fish tracking prototype using a variety of different tracking technologies.

His TED Talk (How supply chain transparency can help the planet) is an excellent explanation of how supply chain transparency can help the planet using Blockchain, GPS-tracking, RFID, and QR for sustainably caught fish and other green goods. And how verified product information can help people live more sustainable lives:

► Blockchain-based product authentication for green goods

With ivault, companies can not only provide consumers with immutable information about the environmental friendliness of green goods. ivault offers a new and more authentic communication channel to create a remarkable customer journey — based on improved supply chain transparency.

Moreover, our distributed ledger is green as well — the energy consumption is lower than that of any normal computer. We have already discussed how Blockchain can help the environment here: Sustainable blockchain supply chain solutions in 2020.

Use case: Blockchain as anti-counterfeiting technology for the pharma industry

Use case: Blockchain product authenticity verification process to retrieve data about the sustainability of a product.

 

The Blockchain-based sustainability check for mobile devices works essentially the same like the anti-counterfeiting use case in the picture you have seen before — scan a QR-Code or read NFC tags integrated with the sustainable product and the ivault platform will retrieve all the data on the manufacturing conditions and sustainability of this product provided by the company.

4. Tracking assets to prevent theft

Both for B2B, logistics and supply chain, and for consumers.

In the past, we have talked a lot about how we increase overall supply chain security to combat the counterfeit market. For some companies, the number of stolen goods can be a much bigger problem.

We have long been working on use cases for asset tracking, anti-theft and crime prevention as well. We are using Blockchain for container tracking and cargo theft prevention, for example. Some anti-theft systems based on the ivault Blockchain and small-scale technologies, like sensors and embedded chips, are already on the market.

Here is one of them — our pilot project for theft prevention:

► Blockchain & GPS for theft prevention

A few months ago, we entered a cooperation to conduct a pilot for theft prevention of outdoor-stationary objects. The devices are connected to the ivault platform and feature multiple locating and transmission methods while using military-grade end-to-end encryption.

The battery life of the tracking devices is 10 years and various alerts are being sent in case of attempted theft, such as unscheduled movement, removal of the tracker, etc. The devices can be equipped or connected to a wide range of sensors for monitoring purposes.

Preventing theft by combining blockchain with GPS tracking devices (on market); can be used to track stolen containers and prevent cargo theft on a global scale.

Blockchain for theft prevention using high-end GPS trackers.

 

Theft prevention combining Blockchain with GPS tracking devices (on market); can be used to track stolen containers and prevent cargo theft at large. Can also secure expensive medical devices that are being shipped and at high risk to be stolen.

► Bike theft prevention on the ivault App

Private citizens, on the other hand, can use the ivault app to track physical assets. One of the results is that Blockchain can serve as a social deterrent to prevent bike theft and make communities safer.

The Blockchain Social Network concept also sets a new security standard for other social media platforms with a long history of abusing and selling personal data of customers…

In contrast, by using Blockchain to protect user data, we are creating a social platform that leaves no space for criminal cyber activities to hack and steal data. We are excited to combine our B2C solution for physical asset recovery with asset insurance in the future as well.

However, we will discuss both B2B and B2C Blockchain / Asset tracking use cases in the next entry.

Anti theft: bike theft prevention with the ivault App.

Anti-theft: bike theft prevention with the ivault App.

5. Building a social engagement platform

To find help when you need it

As our CEO Arman Sarhaddar states in our US TV commercial: In the past, way before the revolution of the internet, people had more compassion for each other. If someone lost something, they would help look for it. If someone needed to borrow something, there would be no question to help out.

Unfortunately, those habits got lost in this fast-paced society we are living in — despite being more connected than ever through digitalization and globalization.

With the ivault mobile app for local communities, we are creating a social engagement platform for private citizens to find local help more easily. We enable every single person to use Blockchain for social impact by supporting each other. Apart from our huge lost & found database, anyone can lend or borrow items or simply ask their local community questions.

A digital social engagement platform like this makes it much easier to help others and to get help quickly whenever you need it.

And it can effectively boost social change.

ivault social engagement platform for locals to help each other and meet new friends with the highest level of cybersecurity.

Visit ivault.app to get the ivault App — a social engagement platform for locals to help each other and meet new friends with the highest level of cybersecurity.

3 Digital Trends in 2021 for the Blockchain Revolution We Need

Despite the many hurdles due to the global pandemic in 2020, Vault Security Systems AG was able to win many new clients and partners who think – and act – with us towards a better future.

According to CIO Applications, CIO Bulletin and Technology Innovators, we are among the world’s leading pioneers in blockchain and blockchain for supply chains. But in the fight against counterfeiting and fraud, the actual implementation of innovative ideas counts more than all the awards, publications on renowned platforms and invitations to international events.

That’s why we want to elaborate on 3 digital trends that blockchain can revolutionize in 2021.

In this blog entry you will also learn how ivault for companies and consumers can contribute to this development – with 3 strong Blockchain Use Cases.

Blockchain steht für Cybersecurity: Die Blockchain Technologie kann helfen Datenschutz und Datensicherheit zu erhöhen.

Blockchain 2021


What Technology Innovators says about ivault

 

Technology Innovators, the “New-age knowledge sharing platform,” ranks Arman Sarhaddar as one of the Top 25 Blockchain Technology CEOs 2020. They are writing:

 

Arman knew right from the start: Blockchain is much more than Bitcoin. And today, there are many blockchain providers trying to capture the Supply Chain market. But Blockchain Technology alone is only one side of the coin. It is the combination of Distributed Ledger Technology (DLT) with other technologies that is the way forward.

There is nothing more to do than to proudly agree with Technology Innovators: With our anti-counterfeiting technology ivault we really are among the pioneers.

Our platform helps not only companies protect products by shielding the entire supply chain against fraud and counterfeiting – thanks to improved supply chain transparency and traceability. ivault.app for a safer neighborhood enables consumers to protect their most valuable items and assets against theft and loss as well – not only in their immediate environment, but also on a global scale.

The difference between these two business models? With customized Blockchain solutions, companies benefit from the supply chain security and traceability provided by Distributed Ledger Technology. They can also provide customers with transparency regarding production conditions. Another advantage is that customers can thus check via smartphone that the products are indeed authentic originals.

 

3 digital trends and our Blockchain Use Cases

 

This month, Blockchain expert Arman Sarhaddar published an article about 3 striking digital trends that clearly emerged for 2021:

  1. The combination of established technologies with innovations such as Blockchain or Distributed Ledger Technology (DLT)
  2. Blockchain and sustainability: Sustainable business models are becoming increasingly important
  3. The social collective: digital solutions against isolation and loneliness during the global pandemic

These 3 digital trends call for a Blockchain revolution via innovations like ivault. Below we will demonstrate this with three of our Blockchain use cases.

1. Combining different technologies

 

There are many Blockchain companies and startups that claim expertise in the field. But Blockchain is not all that is needed for a digital revolution. The Distributed Ledger Technology can only develop its full potential when it is linked with other technologies.

Many technologies are already well established and mature in many aspects. Of course, these technologies must continue to be used and combined with Blockchain Technology, these are responsible for success. Providers of innovative solutions can be connected via APIs and integrated into an existing IT infrastructure, workflows and testing processes.

In this way, a familiar interface can be supplemented and optimized with additional functions, which can result in an enormous gain in efficiency. This is the case not only for Blockchain but for Artificial Intelligence and other innovations as well.

With ivault, for example, we are already using QR codes, NFC chips and GPS trackers in products that can be monitored using Blockchain tracking. This makes the supply chain, products, and manufacturing conditions completely transparent and traceable.

Blockchain Supply Chain Use Case Nr.1: Counterfeit and fake drugs

The great advantage in our case is that the technical weaknesses of QR codes, for example, can be offset by the high information security of a decentralized database. We have already demonstrated this with food products such as Golisan’s herbal extracts, which have been certified with the ivault verified label.

Putting QR codes on product packaging is a particularly cost-effective measure. But they can also be easily copied and then pasted onto a counterfeit product, for example. But the data stored in a decentralized way based on Blockchain Technology cannot be changed or manipulated.

So if each individual product receives its own unique QR code, as is the use case with Golisan, there can be no QR code twice. This means that counterfeiting can be noticed very quickly if duplicate or even multiply copied QR codes are scanned – e.g. by customers who unknowingly purchased counterfeit drugs from a dubious online pharmacy.

Right after the buyer scanned the QR code he can check for himself that the product was never sold to that online pharmacy by the drug manufacturer! – as long as the manufacturer makes this information available to the general public via the ivault app. He immediately gets a fake drug alert notice. And so does the manufacturer.

So – although the use of QR codes has been criticized time and again before – we have clearly created a new value here, thanks to the uniqueness of QR codes and Distributed Ledger Technology. Of course, even more secure – especially in relation to pharmaceutical products – is the use of NFC chips in combination with Blockchain.

In the coming year, we can look forward to more innovative linkages that combine the best features of multiple technologies and solve a variety of different challenges.

Supply Chain Fälschungssicherheit bei Golisan: Die Nahrungsergänzungsmittel von Golisan haben nun das ivault verified Label auf der Produktverpackung und je einen eigenen QR-Code auf der Etikette.

Anti-counterfeiting solution based on Blockchain at Golisan: Golisan’s herbal extracts now carry the ivault verified label on the product packaging and each bottle has its own unique QR code, to make the products 100% counterfeit-proof.

 

2. Blockchain and Sustainability?

 

Sustainable business models are the future. Because we won’t have any other.

As CEO Arman Sarhaddar puts it, “Sustainability has long been more than a buzzword – it’s a necessity, rightly demanded by both customers and business partners.”

Here are some examples for new business models that focus on sustainability:

  • Circular Economy (a model in which resources are not consumed but used and reused wherever possible)
  • new product paradigms such as the cradle-to-cradle design concept and
  • sustainable offerings in the financial sector

However, sustainability encompasses not only the ecological dimension, but also the social and economic dimensions. Technologies that enable sustainable business models to be successfully implemented and optimized will also be in high demand in 2021 and will be further developed.

This is also where Blockchain comes into play again – for example, in fishing and fish farming. Responsibly caught fish will become traceable through Blockchain Technology, and by monitoring the supply chain, substandard products can be detected earlier. New productions, recalls, and damages can thus be reduced.

Blockchain Supply Chain Use Case Nr.2: Sustainable Fashion

In the case of clothing, proof of sustainability is also becoming increasingly important: Buyers of these products want to be sure that their clothing is 100 percent sustainably produced, especially if they are expected to pay a higher price.

From the production of materials to the point of sale, every step in the complex supply chains of clothing manufacturers must be identifiable beyond doubt. If this is the case, counterfeit products on Ebay or Amazon, for example, can be quickly identified.

In addition to authentication via smartphone, thanks to ivault, consumers also get the transparency they want regarding sustainable materials and fair production conditions – whether it is sustainable fashion, branded clothing or luxury goods like watches as well as fish, meat or other foods.

Blockchain is setting a new benchmark in consumer trustivault is the prime example of the new way of connecting manufacturers and consumers – a Blockchain-based communication channel that increases trust in a brand. This can also increase brand awareness. Companies, on the other hand, know the buyers and owners of their products.

3. Togetherness – during and after COVID-19

 

The year 2020 has shown us more than clearly that digital solutions can make a very valuable contribution to strengthening interpersonal relationships and counteracting isolation and loneliness caused by COVID-19-related “Social Distancing”.

Providers for video conferences like Zoom, collaborative communication tools like Slack, and in the private sector apps like Houseparty already experienced a high demand during the first lockdown. Traditional social media platforms like Facebook, on the other hand, are losing relevance. Thus there is clearly a need for new technologies that can connect people and better replace real physical interaction digitally. The need for digital networking options will continue to grow in 2021.

Last but not least, the current crisis is leading to more solidarity between and among people. The great willingness to go shopping for people from at-risk groups is just one example. This greater networking in one’s own neighborhood and the renewed recognition of how valuable it is will give a particular boost to digital platforms that bring people together at the local level.

The Forrester study “2021 Predictions” also points to these developments, which play a central role for customer service and the authentic communication with customers as well. The goal of every company should be to anticipate consumer behavior and needs. These resources can provide important insights:

Blockchain Use Case Nr.3: Digital tools for a better local community

While digital solutions for local networking among people will be on the rise, data protection and information security will also become an even more relevant topic in 2021. Proper handling of customer and user data in compliance with the GDPR is central to the implementation of new digital solutions such as the ivault.app for consumers.

ivault brings people together locally, enables trusting and secure coexistence in every neighborhood. In doing so, the technological properties of Blockchain guarantee the highest possible protection for user data – while many apps collect vast amounts of personal data and users are hardly aware of what their apps know about them.

Our Blockchain-based platform is anonymous. Users decide for themselves when to disclose what data about themselves.

For example, a user can register his brand new e-bike in his anonymous Blockchain wallet at ivault to protect it from loss and theft. Not even we know, who has entered what valuables and items in our decentralized database, because we do not collect any of this personal data.

However, if the e-bike is stolen, the owner can report the theft via ivault, making it public for his neighborhood and surrounding areas. This is the only way that the stolen bike, a lost wallet or a runaway dog can be found and returned to the owner by someone nearby. A trustworthy babysitter or tutor nearby can also be found more easily this way, of course.

More importantly, the owner briefs his neighborhood of theft crime going on nextdoor. ivault thus acts as a cornerstone of a safe, responsible and trustworthy neighborhood. Crime prevention is guaranteed, because fraud and theft are hardly left any room, as ivault supports the entire community to keep an open eye for fellow citizens – without much effort, because every user receives important notifications such as theft reports directly on their smartphones.

 


Summary
10 Advantages of the Blockchain solution ivault

 

ivault has set itself the goal of establishing a new standard in anti-counterfeiting using Blockchain Technology. That is, for every company, every product and every individual consumer. In an earlier article, we already pointed out some advantages of the ivault Blockchain solution, which we want to summarize for you again in the following paragraphs:

1. Combining innovative and well-established technologies

The potential of ivault Blockchain lies in the combination with other established technologies such as NFC or GPS. In doing so, the customized Blockchain solution can be easily integrated into an existing Supply Chain Management system to increase anti-counterfeiting, traceability and transparency. Within a short time, we were able to implement this for the company Golisan, for example.

2. Supply Chain Traceability

Every production step in the supply chain is traceable in the long term. The manufacturer has real-time information about where a product is located or which production step it is currently undergoing – including suppliers, intermediaries and distribution partners. This makes it easy to trace where counterfeit products might have entered the process.

3. Supply Chain Transparency

With the help of ivault, the entire supply chain thus becomes transparent – for the manufacturer as well as for the end consumer, who nowadays is very concerned about sustainability, animal welfare and fair production conditions. The manufacturer can use our B2B solution to give environmentally conscious consumers the transparency they desire.

If a buyer scans the QR code on a Golisan product, for example, he or she gets all the information about the ingredients and their origin – full supply chain transparency thanks to Blockchain Technology. With its herbal extracts, the Swiss company is thus unrivaled on the food market so far …

4. Significant damage reduction for companies

Financial losses and damage to a company’s reputation are reduced because counterfeit products that infiltrated the supply chain can be detected much faster thanks to ivault. Consumers are thus less likely to be harmed by cheaply produced imitations such as fake drugs.

Corona Arzneimittelfälschungen, Fälschungssicherheit Supply Chain Transparency

Whether it’s imitations of branded clothing that are contaminated with pollutants, harmful counterfeit drugs, or defectively imitated spare parts for elevators, motor vehicles, or even airplanes – product counterfeiting entails serious, sometimes fatal consequences. These risks can be drastically reduced with the help of our Blockchain solution.

5. Preventive counterfeiting protection with the blockchain

Being able to track exactly where counterfeiters have infiltrated a supply chain also serves to prevent counterfeiting and fraud attempts. The efficiency of Blockchain, in terms of traceability and supply chain visibility, is an effective deterrent against counterfeiters who fear that their criminal activities will be exposed even before they are able to make a profit.

For companies that have already implemented our technology, this competitive advantage is essential. Thanks to ivault, they have not only an preventive anti-counterfeiting solution, but they were also able to build a new relationship of trust with their customers. For the competition, on the other hand, it is becoming increasingly difficult to make up for this deficit.

6. Consumer trust thanks to transparency and authenticity

The many advantages of ivault for companies have a particularly positive effect on the customer relationship, because the customer also has many advantages thanks to ivault. First, he can have full transparency when it comes to sustainable products, fairtrade and animal welfare. Secondly, consumers can easily check at any time from anywhere with any smartphone whether they bought an original product. This enables consumers to gain new trust in a brand – even after previous damage caused by counterfeiting.

7. Crime prevention in local communities

Not only global counterfeiting crime can be drastically reduced by ivaultivault also has a preventive effect on the environment of individual consumers. A neighborhood that uses ivault to recover stolen items, such as bicycles, actively tackles theft crime. Bicycle thieves and other criminals are effectively put in their place as a result.

Is it that simple? Yes. An effect deterrent to prevent theft crime can be something as simple as an ivault sticker. Thus the owner can put the ivault logo on his bike after registration and flagrant thieves will immediately see that the owner uses ivault. Thus the owner will report a theft as soon as he notices and thereby informs and alerts the entire neighborhood! The criminal must fear that he will no longer remain undetected.

8. Guaranteed Data Privacy

Data is stored in a decentralized way. This means that once data have been entered, they can no longer be manipulated. This ensures the highest level of information security and makes fraud virtually impossible – a huge benefit not only for businesses and consumers, but also for the whole insurance industry! Furthermore, the Blockchain is anonymous. We do not steal customer data. Read more about the advantages of blockchain technology here.

9. Sustainability and scalability of our Blockchain solution.

Blockchain scalability in the crypto sector has become one of the biggest challenges, especially for the giants Bitcoin and Ethereum. The culprit is the somewhat outdated, energy-consuming proof-of-work algorithm. ivault, on the other hand, deliberately does NOT use this algorithm. Our blockchain technology is scalable. This means we can even perform 100,000 transactions per second if needed.

However, the ivault Blockchain has nothing to do with FinTech and cryptocurrencies like Bitcoin or Ethereum. Bitcoin mining in particular is known for being environmentally harmful and consuming a lot of energy. But Distributed Ledger Technology can also be implemented in an environmentally friendly way – as in our case.

10. Trust, security, comfort & happiness

All this leads to more security, trust and satisfaction on both sides: Both supply chains and products, homes and neighborhoods become more secure thanks to ivault. Companies and consumers can trust each other, while at the same time companies can better trust their business partners and individual users can better trust their peers. The insurance industry will also happy to see fewer fraud claims.

Blockchain enables a win-win situation in which all parties benefit and can live more comfortable, carefree and happy lives.