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

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 Added by Neo Chung-Kit Yiu
 Publication date 2021
and research's language is English
 Authors Neo C.K. Yiu




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A variety of innovative software solutions, addressing product anti-counterfeiting and record provenance of the wider supply chain industry, have been implemented. However, these solutions have been developed with centralized system architecture which could be susceptible to malicious modifications on states of product records and various potential security attacks leading to system failure and downtime. Blockchain technology has been enabling decentralized trust with a network of distributed peer nodes to maintain consistent shared states via a decentralized consensus reached, with which an idea of developing decentralized and reliable solutions has been basing on. A Decentralized NFC-Enabled Anti-Counterfeiting System (dNAS) was therefore proposed and developed, decentralizing a legacy anti-counterfeiting system of supply chain industry utilizing enterprise blockchain protocols and enterprise consortium, to facilitate trustworthy data provenance retrieval, verification and management, as well as strengthening capability of product anti-counterfeiting and traceability in supply chain industry. The adoption of enterprise blockchain protocols and implementations has been surging in supply chain industry given its advantages in scalability, governance and compatibility with existing supply chain systems and networks, but development and adoption of decentralized solutions could also impose additional implications to supply chain integrity, in terms of security, privacy and confidentiality. In this research, an empirical analysis performed against decentralized solutions, including dNAS, summarizes the effectiveness, limitations and future opportunities of developing decentralized solutions built around existing enterprise blockchain protocols and implementations for supply chain anti-counterfeiting and traceability.



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281 - Neo C.K. Yiu 2021
Innovative solutions addressing product anti-counterfeiting and record provenance have been deployed across todays internationally spanning supply chain networks. These product anti-counterfeiting solutions are developed and implemented with centralized system architecture relying on centralized authorities or any form of intermediaries. Vulnerabilities of centralized product anti-counterfeiting solutions could possibly lead to system failure or susceptibility of malicious modifications performed on product records or various potential attacks to the system components by dishonest participant nodes traversing along the supply chain. Blockchain technology has progressed from merely with a use case of immutable ledger for cryptocurrency transactions to a programmable interactive environment of developing decentralized and reliable applications addressing different use cases globally. In this research, so as to facilitate trustworthy data provenance retrieval, verification and management, as well as strengthening capability of product anti-counterfeiting, key areas of decentralization and feasible mechanisms of developing decentralized and distributed product anti-counterfeiting and traceability ecosystems utilizing blockchain technology, are identified via a series of security and threat analyses performed mainly against NFC-Enabled Anti-Counterfeiting System (NAS) which is one of the solutions currently implemented in the industry with centralized architecture. A set of fundamental system requirements are set out for developing a blockchain-enabled autonomous and decentralized solution for supply chain anti-counterfeiting and traceability, as a secure and immutable scientific data provenance tracking and management platform in which provenance records, providing compelling properties on data integrity of luxurious goods, are recorded and verified automatically, for supply chain industry.
370 - Neo C.K. Yiu 2021
An interesting research problem in supply chain industry is evaluating and determining provenance of physical goods - demonstrating authenticity of luxury goods. Yet, there have been a few innovative software solutions addressing product anti-counterfeiting and record provenance of todays goods that are produced and transported in complex and internationally-spanning supply chain networks. However, these supply chain systems have been 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 supply chain industry. 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, are validated automatically.
Monero is a privacy-centric cryptocurrency that allows users to obscure their transactions by including chaff coins, called mixins, along with the actual coins they spend. In this paper, we empirically evaluate two weaknesses in Moneros mixin sampling strategy. First, about 62% of transaction inputs with one or more mixins are vulnerable to chain-reaction analysis -- that is, the real input can be deduced by elimination. Second, Monero mixins are sampled in such a way that they can be easily distinguished from the real coins by their age distribution; in short, the real input is usually the newest input. We estimate that this heuristic can be used to guess the real input with 80% accuracy over all transactions with 1 or more mixins. Next, we turn to the Monero ecosystem and study the importance of mining pools and the former anonymous marketplace AlphaBay on the transaction volume. We find that after removing mining pool activity, there remains a large amount of potentially privacy-sensitive transactions that are affected by these weaknesses. We propose and evaluate two countermeasures that can improve the privacy of future transactions.
Monero is a privacy-centric cryptocurrency that makes payments untraceable by adding decoys to every real input spent in a transaction. Two studies from 2017 found methods to distinguish decoys from real inputs, which enabled traceability for a majority of transactions. Since then, a number protocol changes have been introduced, but their effectiveness has not yet been reassessed. Furthermore, little is known about traceability of Monero transactions across hard fork chains. We formalize a new method for tracing Monero transactions, which is based on analyzing currency hard forks. We use that method to perform a (passive) traceability analysis on data from the Monero, MoneroV and Monero Original blockchains and find that only a small amount of inputs are traceable. We then use the results to estimate the effectiveness of known heuristics for recent transactions and find that they do not significantly outperform random guessing. Our findings suggest that Monero is currently mostly immune to known passive attack vectors and resistant to tracking and tracing methods applied to other cryptocurrencies.
Supply chain applications operate in a multi-stakeholder setting, demanding trust, provenance, and transparency. Blockchain technology provides mechanisms to establish a decentralized infrastructure involving multiple stakeholders. Such mechanisms make the blockchain technology ideal for multi-stakeholder supply chain applications. This chapter introduces the characteristics and requirements of the supply chain and explains how blockchain technology can meet the demands of supply chain applications. In particular, this chapter discusses how data and trust management can be established using blockchain technology. The importance of scalability and interoperability in a blockchain-based supply chain is highlighted to help the stakeholders make an informed decision. The chapter concludes by underscoring the design challenges and open opportunities in the blockchain-based supply chain domain.
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