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Number Of IBM Blockchain Patents Has Grown By 300%

IBM Patents

It is now emerging that IBM has been
investigating new applications of blockchain technology in the last year.
Consequently, the technology-focused company has increased the number of
blockchain patents. For clarity, a patent is considered to be an official
document issued by a government to restrict other parties from using the
invention, intellectual property, or idea without a prior written agreement.

According to Ginni Rometty, chairman, IBM:

“IBM is committed to leading the way on the technologies that change the way the world works – and solving problems many people have not even thought of yet. Our clients and their customers are the beneficiaries of these innovations, particularly our leadership in AI, cloud, blockchain, and security for business.”

Patents on Network Security and Database Management

Some of the patents filed by IBM in 2019
include one that focuses on network security and another that seeks to
streamline management of traditional databases. A short description of the
patent focusing on network security using blockchain technology notes that the
security of a data log while employing monitor security protocols can be
ensured using a “combination of hardware and software configurations.”

On database management, the patent notes that:

“Database management systems (DBMSs) are typically configured to separate the process of storing data from accessing, manipulating, or using data stored in a database. DBMSs often require tremendous resources to handle the heavy workloads placed on such systems. As such, it may be useful to manage a DBMS using blockchain technology.”

As of June 2019, the top companies in the United States with the highest number of blockchain patents were led by IBM, Bank of America, MasterCard, and Intel with 108, 52, 43, and 53 patents respectively.

Jesse Lund and CTO Yong Departure

Unfortunately, the rate of filing patents or
even bringing the filed patents to life is likely to slow down given the
departure of two key individuals from IBM.

The first to leave was Jesse Lund who headed IBM’s blockchain department that sought to streamline the financial services sector and virtual currencies. Lund left in May but said that he is “still optimistic about payments innovation using blockchain.” He formerly worked in the banking sector and was keen on exploring central bank virtual currencies, stablecoins, among other crypto uses in the enterprise sector.

Notably, Jesse led the World Wire network developed by IBM to tackle cross border payments by using the Stellar blockchain network. Before his departure, the former banker had already courted six financial institutions including South Korea’s Bank Busan and Banco Bradesco in Brazil.

It is worth noting that IBM’s World Wire is available in 72 countries and supports 47 currencies. However, according to Jed McCaleb, Stellar’s co-founder, it’s unlikely that the departure of Lund will hurt the cooperation between Stellar and World Wire. A few weeks after Lund’s departure, IBM’s CTO, Stanley Yong, left further crippling IBM’s push to use blockchain technology in the financial sector. Yong headed the Central Bank Digital Currency Solutions.

Unfortunately, with the departure of Yong and Lund, it will take a little longer for IBM to develop the pile of patents into tangible products and or services. Also, since Lund was at the center of the World Wire and Stellar partnership, it’s unclear whether IBM will stay committed to using the Stellar blockchain platform.

The post Number Of IBM Blockchain Patents Has Grown By 300% appeared first on Ethereum World News.

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IBM Triples Number of Blockchain Patents in US Since Last Year

IBM has tripled the number of blockchain-related patents it holds in the U.S. this year, dwarfing other US blockchain bulls.

Tech giant IBM has tripled the number of blockchain patents secured in the United States since last year, currently boasting over 100 active patent families. That makes IBM’s growth in US patents the largest of last, according to a report by BeinCrypto on July 16.

According to data gathered by Yuval Halevi, co-founder of crypto and blockchain PR company GuerillaBuzz, IBM’s number of active patent families dwarfs other notable corporations. This includes some primary tech companies, such as Intel, Microsoft, and Dell Technologies:

“In just 1 year the number of IBM blockchain patents has grown by 300%. When one of the largest companies in the world (366,000 employees) spends so much of their resources on developing a blockchain department, this tells a lot about the market potential.”

However, IBM reportedly does have international competition. As noted in the report, China is currently outpacing the U.S. and world at large in terms of blockchain patents. Alibaba, in particular, is reportedly the leading Chinese company in blockchain patents, despite having only 25 patents filed in the U.S. as per Halevi’s Twitter post.

As of May, Alibaba had applied for a whopping 262 patents, according to figures from Securities Daily. According to this report, China was also the global leader in blockchain-related patent applications, with organizations in the country apparently filing for 4,435 patents between 2013 to 2018. During the same period, the U.S. reportedly filed for 1,833 patents. 

However, another study presented by the Swiss Federal Institute of Intellectual Property and Withers & Rogers LLP previously reported by Cointelegraph suggested that more blockchain patent applications were filed in the U.S. than China between 2012 and 2018, according to data. According to this report, the U.S. had filed 1,680 patents at this time while China had filed 1,590. Additionally, IBM reportedly filed 143 patents during this period, still clocking in at the number one application spot. The origin of the disparate findings this report versus that of Securities Daily is unknown.

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Middle East Blockchain Development Primed to Lead the Global Industry

A large number of Gulf nations are embracing crypto with open arms as Ethereum explores partnership opportunities…

While we often get to hear about how cryptocurrency adoption is rapidly gaining ground in the West, a number of countries across the Middle East — such as Bahrain, the United Arab Emirates and Saudi Arabia — often tend to get overlooked, despite them having made tremendous strides when it comes to establishing regulatory frameworks that are geared toward the optimal utilization of this burgeoning asset class.

For example, a recent report by Asia Times has revealed that the UAE is one of the few nations in the world where the local government has placed special emphasis on promoting the use of crypto. In this regard, we can see that over the first quarter of 2019, UAE-based blockchain startups were able to raise a total of $210 million — thereby putting the Gulf nation at the apex of the world’s top-10 token sale list, even surpassing countries like the United States and the United Kingdom. What is most surprising is that just over a year ago, the UAE didn’t even make it on this list, thus proving that the onset of this recent crypto wave throughout the Middle East is somewhat of a recent phenomenon. 

In the same breath, it is also worth pointing out that the U.S. has now slid from the number one spot to sixth in the aforementioned crypto funding list, primarily because the nation’s lawmakers have adopted a somewhat confusing stance toward the digital asset industry as a whole. On the subject, Alex Buelau, the CEO of CoinSchedule, tends to agree with the notion that, due to a number of regulatory concerns, more and more companies are moving away from the U.S. in favor of more hospitable regions such as the Cayman Islands, Singapore, etc. 

Related: US a Crypto Exchange Scarecrow — What Needs to Change?

Not only that, Buelau also pointed out that, owing to the heavy-footed approach that countries such as China and India have adopted toward their local crypto markets, it appears as though the Middle East is now primed to lead the way for crypto adoption across Asia.

Lastly, according to reports, the Ethereum Foundation has recently been trying to make its way into the Gulf altcoin market by cooperating with financial experts. If successful, the organization could possibly help push partnerships with other established crypto firms in the coming future.

Notable developments worth highlighting

As many of our regular readers may be well aware of, Bahrain has made a lot of “under the radar,” crypto-friendly moves since the start of 2019 — with the nation’s central banking authority introducing an economic framework earlier this February that covers a host of rules related to the digital asset domain. On this recent development, Khalid Hamad, an executive director at the Central Bank of Bahrain (CBB), was quoted as saying:

“The CBBs introduction of the rules relating to crypto assets are in line with its goal to develop comprehensive rules for the fintech ecosystem supporting Bahrain’s position as a leading financial hub in the Middle East and North Africa”

Additionally, the Bahraini government was also involved in a joint crypto pilot venture along with Saudi Arabia and the UAE so as to help increase local awareness about blockchain technology as well as make cross-border payments between these countries more streamlined and hassle-free.

In a similar vein, Saudi Arabia is another nation that is also making use of blockchain technology to facilitate its international monetary transfers. For example, as per the announcement made by the Saudi British Bank (SABB) at the beginning of this year, the financial institution has partnered with California-based blockchain firm Ripple to launch an instant cross-border transfer service for its clients. Not only that, even the Saudi Arabian Monetary Authority (SAMA) is making use of a blockchain-based remittance system to facilitate transactions between various banks located within Saudi and the UAE.

Blockchain startups are targeting the Gulf elites

Another recent phenomenon that seems to be attracting attention is that established crypto entities are turning to the Middle East in order to acquire investments for their envisioned projects. For example, it recently came to light that the Ethereum Foundation was partnering with finance experts from the Persian Gulf in order to showcase the compatibility of their blockchain ecosystem with existing Islamic rules and regulations — sharia in particular.

This is probably the first time a big-name crypto organization has taken such a step to secure a large-scale investment from the region’s financial elites. On the subject, Ethereum Foundation’s head of special projects, Virgil Griffith, was quoted as saying:

“My job is to keep rolling dice. Probably nothing will happen. But there’s a hypothetical case where say, the Saudi sovereign wealth fund invests, like, a trillion dollars [in Ethereum projects], which would be a real boon. That would be really great.”

Not only that, there are also firms like Houston-based Data Gumbo that have been successful in creating a blockchain-as-a-service (BaaS) platform that is now being used by various offshore drilling firms situated in the Gulf region. Through its Series A equity funding round, Data Gumbo was able to raise a sizeable sum of $6 million from the Saudi Arabian national petroleum and natural gas company Saudi Aramco and leading Norewegian energy operator Equinor.

Also in a conversation with Cointelegraph, Matthew J. Martin, founder and CEO of Blossom Finance, said:

“The DIFC (Dubai International Financial Center) with its FinTech Hive is attracting many interesting ventures. Since DIFC companies are allowed 100% foreign ownership, it’s a solid option for many international teams looking for either their primary jurisdiction, or as a primary base to support operations regionally. The acquisition of Souq by Amazon was also great validation of the exit potential for investors, and this will likely increase the volume of venture capital pouring in. With the strong public sector support for blockchain projects we’re seeing in the UAE, it’s likely that more international teams will chose the DIFC to incorporate.”

It is worth pointing out that there is an overarching issue that the Gulf oil and gas industry is currently facing in the form of data inconsistency. This is because niche measurements related to the weight, speed, delivery time, volume, etc. of crude oil are interpreted differently by various operators, service providers and suppliers. This not only results in tangible work-related delays but also causes large-scale payment disputes among all of the member parties. 

Data Gumbo’s aforementioned platform minimizes such issues through the use of its BaaS network and smart contract technology, as it allows participating firms to obtain automated calculations on their invoice line items in real time. This enables important transactions to take place in a transparent manner. On the future potential of Data Gumbo’s BaaS-enabled platform, the company’s CEO, Andrew Bruce, noted:

“We enabled the first application of blockchain technology in the offshore drilling industry and will continue to break new ground with applications of BaaS to improve the bottom line of companies of all sizes. Blockchain will have a major impact on the oil and gas industry — and all global industries — and we will lead the charge in its broad adoption for sweeping operational improvements.”

More use cases

ADNOC: The Abu Dhabi National Oil Company (ADNOC), which is the UAE’s largest oil firm, recently collaborated with IBM to devise a novel blockchain-based automated system to keep a close eye on the financial values of each transaction taking place between its operating members. Additionally, the new platform has been built atop Hyperledger and makes use of the IBM’s native Cloud computing technology.

S&P Global Platts: The world-renowned energy and commodities information provider released a blog post recently announcing its decision to create a blockchain network that would allow market participants to provide the Fujairah Oil Industry Zone (FOIZ) with weekly inventory oil storage reports in a highly streamlined manner. FOIZ currently lays claim to the title of being the Middle East’s biggest commercial storage region for refined oil products.

NBAD: The National Bank of Abu Dhabi (NBAD) signed an agreement with Ripple back in 2017 in order to make use of the firm’s various blockchain offerings. The entire point of this exercise for NBAD was to streamline its monetary transactions and make international payments more accessible for its customers.

The potential roadblocks

Even though a number of novel blockchain projects have emerged from across the Middle East over the past year or so, various roadblocks that are preventing many Western firms from capitalizing on this untapped market segment still exist. For starters, the issue of shaira compliance is preventing various big-name companies from accessing the $3.4 trillion market simply because their operational protocols do not adhere to existing Islamic law. But it is not as if Gulf nations such as Saudi Arabia, Oman, the UAE are not interested in making use of blockchain tech, as just last year, the crown prince of Dubai has announced that the city was going to deploy a blockchain-based administration system by 2020 that will allow the local government to digitize the ID, tax and registry details of its citizens and will store the data on a blockchain network.

Related: From Qatar to Palestine: How Cryptocurrencies Are Regulated in the Middle East

With that being said, the Islamic banking sector at large is still holding on to its skeptical view of blockchain because most financial institutions operating within the region adhere to certain long-held traditions that are in direct conflict with the way Western banks work. For example, sharia law prohibits the lending of money using a fixed interest rate model (Riba) — a common practice used by many banks across the world. However, since crypto and blockchain makes use of a fractionalized ownership framework, it is possible to make money lending complaint with the Islamic way of doing things. 

In the same way, sharia also prohibits monetary transactions that are ambiguous in nature (i.e., deals that do not have defined legal boundaries). In this regard, smart contracts can be quite useful, as they clearly outline the terms and conditions of a particular exchange beforehand — thereby leaving no scope for future uncertainty.


As the global crypto economy continues to evolve, it seems as though established players such as the Ethereum Foundation and Ripple will continue to try to tap into the Gulf market because of the amazing monetary potential it offers. Cointelegraph recently got in touch with Atif Yaqub — an executive partner at UKP Assets — who is of the belief that, as we move into the future, the Middle East will start playing an ever-increasing role in shaping the digital currency landscape. According to Yaqub:

“As the Gulf nations move to diversify from their oil based economies, there is a huge drive in tech investment. There has been much interest in Blockchain and Crypto companies on the State and private level.”   

Similarly, while elaborating on the topic of how foreign firms are reaching out to Gulf states for ties, partnerships and money, he added:

“The Gulf offers untapped growth opportunities and entry to the wider region. Pursuing comprehensive Shariah certification for a network, like Ethereum has been doing, lifts many barriers to entry. This just expands the use cases and audience.”

Last but not least, with Facebook’s Libra coin all set to enter the altcoin market in the near future, it will be interesting to how crypto adoption spreads throughout the Middle East — especially considering that the social media juggernaut has a little over 265.4 million active users spread across the region.

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Blockchain for the Food, How Industry Makes Use of the Technology

The food industry is becoming one of the most inclusive destinations for blockchain.

As blockchain continues to push for mass adoption, the food and beverage industry is shaping up to be one of the most inclusive destinations for the technology: Just over the past few months, a variety of players — including juggernauts like Nestlé, Carrefour and Starbucks — have reported on their latest blockchain-powered initiatives within the field. 

Indeed, in 2019, blockchain has been piercing the food industry at an accelerated pace. According to recent research, 20% of the top-10 global grocers will use blockchain by 2025. So, what makes the technology so appealing for the food industry participants, and are there any obstacles that can be a hurdle to potential adoption?

Empowering customers with more data and tracking food illness

There are at least two essential problems in the food industry that blockchain has been presumed to solve. First, the trust issue: According to a 2018 study released by the United States-based Food Marketing Institute (FMI), the public demand for transparency is growing within the market. Essentially, customers are becoming more health-conscious and want to know as much as possible about the food they get.

Specifically, the report found that as much as 75% of consumers are more likely to switch to a brand that provides more in-depth product information — beyond what’s provided on the physical label. When shoppers were asked the same question in 2016 in a similar study conducted by Label Insight, just 39% declared they would switch brands. Blockchain, being an easily accessible, immutable distributed ledger by design, seems to be the go-to solution for that case, as it can provide consumers with concrete, immutable data about their food. Matron Ven, the chief marketing officer at blockchain-powered farm-to-table food traceability solution company Te-Food, told Cointelegraph:

“Food companies implement traceability because they see that the consumers require transparency and credibility. Blockchain’s immutability helps them to prove that the information the different supply chain companies provide is uncorrupted.”

Traceability is not just the customer’s whim, however, but a crucial component for the industry at large, in which investigations into foodborne illnesses require extra swiftness to prevent human loss. Rachel Gabato, the chief operating officer at, a San Francisco-based blockchain startup working with the food supply chain, told Cointelegraph:

“One of the primary drivers for food providers to consider blockchain technology is the ability of the technology to collect data from various sources and create a single view of the transactionю This plays an important role in the ability to track the food product back to its origin driving more efficiency when a food safety issue arises.”

For instance, in 2017, the U.S. Food and Drug Administration (FDA) investigated a fatal Salmonella outbreak linked to papayas imported from a Mexican farm. In order to allocate the disease’s original source, the agency conducted over a hundred interviews and studied various mango samples in lab conditions. Blockchain can reduce the process of finding the responsible supplier to seconds: By using the technology, stakeholders can track the corrupt harvest of mangoes from a particular farm and then surgically remove it from the supply chain. 

Related: From South Korea to IBM Food Trust — How Blockchain Is Used in the Food Industry

Indeed, as the food industry entails numerous participants — farmers, vendors, retailers, customers, etc. — within the supply chain, the process of tracking goods from farm-to-table is notably complex. Consequently, the very idea of having a blockchain encourages suppliers and retailers to get their data straight, says John G. Keog, a research associate at Henley Business School and University of Reading, who co-authored an academic article on the topic. He told Cointelegraph: 

“A key benefit not discussed is the fact that data needs to be cleansed, structured and verified before it goes onto a Blockchain. This is one of the key benefits and in the use cases I have examined closely, 75% of the effort was in fixing the data.”

IBM’s blockchain solution continues to dominate the field

The most mainstream and adopted blockchain tracking solution within the field is IBM’s Food Trust, which is based on the Hyperledger Fabric blockchain protocol. With the first product trials spearheaded by Walmart in China in December 2016, Big Blue’s food-tracking ecosystem has since amassed numerous industry giants, including Carrefour, Nestle, Dole Food, Kroger and Unilever. The platform officially went live in October 2018. According to IBM, during the testing period, “millions of individual food products” were tracked by retailers and suppliers using the Food Trust blockchain.

In 2019, the tech behemoth will continue to recruit participants for its blockchain traceability program, as revealed by Nestle S.A. So far this year, Big Blue has already signed Albertsons Companies, a leading food and drug retailer in the U.S. At first, the retailer will use the Food Trust initiative to track the supply chain for romaine lettuce, but it aims to branch out into other products in the future.

Additionally, it has been reported that the U.S. seafood trade association National Fisheries Institute (NFI) is now working with IBM’s Food Trust to trace seafood. Purportedly, this is the first effort to track multiple seafood species, an initiative jointly pursued by multiple companies. Just a couple of months prior to that, North America’s largest branded shelf-stable seafood firm, Bumble Bee Foods, launched a blockchain platform for seafood traceability in collaboration with German tech company SAP. Based on the SAP Cloud Platform Blockchain service, the new platform can purportedly monitor the supply chain of yellowfin tuna from Indonesia to end customers.

Meanwhile, earlier Food Trust members have been expanding the scale of IBM blockchain’s application this year. For instance, in April, Nestlé and French retail giant Carrefour reportedly started using the technology to track the supply chain of Mousline, a well-known brand of instant mashed potatoes. As per the initiative, customers are able to scan a QR-code with their smartphones to know exactly where the potatoes in a specific packet came from, as well as their journey to the exact Carrefour store.

New blockchain-based food traceability tools continue to emerge

Additionally, in March, Carrefour introduced its own blockchain-powered solution for tracking milk, called Carrefour Quality Line (CQL). CQL is reported to guarantee consumers complete product traceability across the entire supply chain — from farmers’ fields to the store shelves. As per the press release, consumers will get access to meticulous information, including GPS coordinates of the farmers producing the milk, details on when it was collected and packaged, as well as the list of stakeholders involved in the product line. Other notable blockchain initiatives happening within the food industry this year include the U.S. National Pork Board partnering with to test out a blockchain platform for pork supply chains. The company’s representative told Cointelegraph of the initiative:

“The platform will enable the NPB ecosystem of pork producers to monitor, evaluate and continuously improve their sustainability practices based on six defined ethical principles guiding the U.S. pork industry. These principles provide industry standards in food safety and public health, animal well-being, protecting the environment, and improving the quality of life for the industry’s people and communities.”

Further, in the beginning of 2019, World Wildlife Fund-Australia (WWF-Australia) and global corporate venture BCG Digital Ventures (BCGDV) jointly launched a blockchain-powered supply chain tool dubbed OpenSC. The system reportedly allows both businesses to track products they produce, as well as consumers to view the origins of said products via a “unique blockchain code at the product’s point of origin.” 

In July, Nestlé joined OpenSC for an initial pilot program that will trace milk from farms and producers in New Zealand to the firm’s factories and warehouses in the Middle East. The aim of the pilot project is to find out whether the system is scalable. Furthermore, the company is considering tracking palm oil sourced in the American Continent. 

Alcohol and coffee: Blockchain is being applied to more niches

Blockchain has been picking up pace within the alcohol and beverage industry as well. In March, news surfaced that premium scotch whisky brand Ailsa Bay is going to release what it believes to be the world’s first scotch whisky tracked with a blockchain-based system, while later in May, the Big Four audit firm E&Y announced its proprietary blockchain solution for a major new platform that helps consumers across Asia determine the quality, provenance and authenticity of imported European wines. 

Finally, Starbucks has unveiled more details regarding its “bean to cup” initiative. In May, it was reported that the coffeehouse chain will implement tech giant Microsoft’s Azure Blockchain Service to track the production of it’s coffee and allegedly provide coffee farmers from Rwanda, Colombia and Costa Rica with more financial independence.

China’s food industry has now co-signed the technology

Interestingly, China’s food and beverage industry — which posted a record high of 4.27 trillion yuan (a whopping $620 billion) in revenue in 2018, and in so becoming the largest in the world — is also increasingly interested in blockchain. In January, the official newspaper of the Chinese Communist Party reported that the Food and Drug Administration of the Chinese Chongqing Yuzhong District is going to apply blockchain to strengthen the supervision of food and drug quality assurance with better traceability of the product life-cycle and anti-counterfeiting measures. 

Additionally, Walmart China also has revealed big plans for blockchain. In June, the company announced it was going to track food through its supply chain using VeChain’s Thor blockchain. According to the press release, the Walmart China Blockchain Traceability Platform (WCBTP) will be a joint venture by Walmart China, VeChain, PwC, cattle company Inner Mongolia Kerchin and the China Chain-Store & Franchise Association. 

So far, Walmart China has revealed 23 product lines that the system will track and plans to release another 100 products for further inclusion, covering more than 10 product categories. Notably, the company expects that tracked sales will be significant in volume. The official statement reads:

“It is expected that the Walmart China’s traceability system will see traceable fresh meat account for 50% of the total sales of packaged fresh meat, traceable vegetables will account for 40% of the total sales of packaged vegetables, traceable seafood will account for 12.5% of the total sales of seafood by the end of 2020.”

In the neighbouring Vietnam, Te-Food has recently implemented blockchain-based traceability at Vinamilk, one of the largest dairy companies in Southeast Asia, with $2.2 billion in yearly revenue. Together, they will track a new infant formula product called Vinamilk Organic Gold.

Other solutions focus on food safety

Some tech companies have been applying blockchain particularly in the context of food safety instead forgoing large retailer sin setting up supply chain management. Thus, in April, Swiss food technology giant Bühler introduced two “blockchain-ready” products: Laatu, a tool aiming to reduce microbial contamination in dry goods, and Tubex Pro, a scale system that self-optimizes and produces a constant flow of production data. Both solutions are connected to the Bühler Insights Internet of Things (IoT) service, hosted on the Microsoft Azure cloud platform.

According to Bühler, their Laatu product is able to destroy over 99.999%of salmonella while maintaining the quality nutritional value of food by exposing dry foods to low-energy electrons. As the press release states, “With a potential link to blockchain, it [Laatu] is capable of providing an accurate and secure audit trail for food producers and all players in the supply-chain.” Further, in June, a nonprofit blockchain organization Iota Foundation teamed up with digital food safety management firm Primority to track food allergens with blockchain. 

Related: 10 Things to Track With Blockchain

As Iota has specified in the announcement, the collaboration aims to reduce risks associated with potentially fatal food allergens, targeting 220 million people worldwide. Specifically, it includes the development of an application that would enable consumers to check a vast variety of foods for allergens, considering that “small traces of an allergen can then appear in the food which was supposed to be allergens free,” as the nonprofit puts it. 

The application will reportedly allow consumers to access a number of details about food products by scanning a barcode on the app. The shared information would include tracking of raw materials used and their suppliers, as well as a review of food production processes. As Iota stressed in the announcement, consumers will be able to access the data “without sharing any personal, sensitive information, and without owning any cryptocurrency.”

Potential hurdles on the way: data-related issues and interoperability problems

However, blockchain adoption within the food industry has its own limitations — at least for now. First, there is no guarantee that the data that suppliers initially enter into blockchain is reliable in the first place — although the technology allows for the prevention of tampering and falsification at later stages in the supply chain. Thus, if a supplier has a reliable in-house system ensuring that its food is attributed correctly when released to vendors, a blockchain can ensure that this data remains immutable. 

However, there is a catch, as Keog pointed out, “Things go wrong in food chains and the need to correct a record is a reality hence we need more research and discussion on the value and need for ‘mutable’ Blockchains.” Further, in most cases, data is difficult to obtain and digitize due to abundance of various setups used by suppliers, says Gabor of She told Cointelegraph: 

“As we have engaged with farmers in the food areas of dairy, meat, produce, citrus, commodities, a primary challenge is the access and availability of data. Farmers capture data in many different forms and the ability to digitize this data for capture and sharing has been our primary challenge.”

“The main challenges of implementations are not blockchain related,” confirms Marton Ven from Te-Food. “It’s a common misbelief, that farm-to-table traceability in centralized format is already an existing method, and we just need to replace it with blockchain based solutions. The reality is that traceability throughout food supply chains is non-existent yet, except for a few examples.” He then elaborated:

“The hardest obstacle comes from collecting data from a large number of different companies. In the recent decades, supply chains have become global, sometimes incorporating hundreds of companies from different countries, with different technological maturity, using different identification methodologies. Keeping the data integrity — which is the backbone of traceability — requires all of them to actively cooperate on what data to collect, how to capture the data, and how to compile the information into meaningful product data, which the consumers can read.”

Interoperability is another hurdle that is important to deal with, according to Keog. However, if blockchain solutions become compliant with the existing GS1 standards — which the food industry have been largely relying upon to format data for shared communications across supply chains before the technology’s arrival — it might be much easier to overcome the obstacles. He added:

“In this context, a Blockchain should be viewed as an outcome of a configuration of multiple technologies, tools and methods and hence interoperability is a critical component. The Blockchain solutions using the GS1 standards for product identification, company identification, location identification and the joint GS1/ISO interoperability standards called Electronic Product Code Information System (EPICS) will excel in this space.”

In the academic’s view, blockchain is not a traceability solution, but a record-keeper that can be used by a traceability platform as a trusted data source. Consequently, the state of supply chains within food industry will largely depend on how these blockchain solutions are applied: 

“Wal-Mart’s strategy with a single platform from IBM Food Trust is an example of both progress and a hurdle at the same time. […] I would have preferred to see Wal-Mart providing a Blockchain enabled, standards-based platform and then their hundreds of suppliers who will use dozens of Blockchain solutions being able to connect and share standards-based data (GS1) seamlessly. Having a vendor lock-in is counterintuitive in the evolving Blockchain world.”

“As traceability throughout food supply chains barely exists worldwide, blockchain has a good chance to become the de facto standard technology for it,” agreed Ven. “But to provide global solution, other standards have to be applied as well, like GS1 standards for identification and event structure.”

Thus, as more retailers and suppliers are joining forces with blockchain companies, the idea of adopting the technology is perceived as more tenable within the food industry. As the experts have stressed, blockchain adoption within the field is not so much about figuring out the technology as the lack of proper data analysis in the first place. Ven told Cointelegraph: 

“We haven’t ever met any food company which refused to use blockchain. Although solution providers have to put in a lot of education effort, food companies are open to the idea of using blockchain. Certainly the media hype around blockchain helps this effort, but 90% of the implementation challenges are not blockchain related ones.”

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Intel Co-Sponsors New Hyperledger Transact Project

Global tech giant Intel continues its blockchain endeavors by co-sponsoring a new blockchain programming project by Hyperledger.

Global tech giant Intel has co-sponsored a new blockchain programming project by major blockchain tech firm Hyperledger, according to a Forbes report on July 3.

Officially released on June 27, Hyperledger Transact is a new tool that aims to boost the compatibility of blockchain networks by providing a standard interface, or a shared software library for smart contracts execution.

Michael Reed, Intel’s blockchain program director, said in an interview with Forbes that the main purpose of the company’s efforts in blockchain development is to ensure that distributed ledger technology solutions “run well on Intel silicon.”

Reed noted that the company is also working to find out the requirements or standards for blockchain developers in consortiums such as Enterprise Ethereum Alliance.

Hyperledger Transact involves a number of companies specializing in different industries, including global tech giant IBM, Intel, as well as tech service firm Bitwise IO and global food supplier Cargill.

Intel is a member of the major blockchain standards consortium, the Enterprise Ethereum Alliance (EEA), which counts over 500 participants, including the United States’ largest bank JPMorgan Chase, blockchain incubator ConsenSys, Big Four auditor EY, as well as tech giants Microsoft and IBM, and blockchain consortium R3.

On June 18, IBM introduced updates on its IBM Blockchain Platform, enabling it to run on multiple cloud networks including Microsoft’s Azure or Amazon Web Services.

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IBM Launches Blockchain Pilot for Bank Guarantee Processes

Tech giant IBM and four Australian financial services companies have launched a pilot for a blockchain-powered platform designed to streamline bank guarantee process.

Tech giant IBM has launched a pilot for a blockchain-powered platform designed to streamline bank guarantee process.

In a press release shared with Cointelegraph on July 3, IBM stated that the pilot was launched in partnership with four Australian financial services companies.

The pilot — dubbed Lygon — is backed by IBM, the Australia and New Zealand Banking Group Limited, Commonwealth Bank, real estate operator Scentre Group, and Australia’s first bank Westpac. The pilot is set to run for eight weeks for a test group of retail property leasing customers starting today.

Essentially, Lygon is a blockchain-based platform that digitizes the issuance and management of bank guarantees in the retail property lease sector. Per the release, digitizing the process will reduce the risk of fraud, decrease potential of errors, as well as increase transparency and security.

Once the pilot is completed, Lygon plans to expand the range of digitised bank guarantees it supports and begin offering them to other industries. Didier Van Not, general manager of Corporate and Institutional Banking at Westpac, said:

“We have created a blockchain-based platform to digitize the bank guarantee ecosystem. The pilot will test live transactions using distributed ledger to prove the technology is commercially viable. It is a great example of digital transformation that refines the customer experience.”

IBM has launched a number of enterprise blockchain offers to date. Last month, CIP, a facilitator of Brazilian banking and financial infrastructure, officially launched its blockchain ID platform via a partnership with IBM using Hyperledger Fabric. Its aim is to authenticate and verify digital signatures using mobile devices.

In March, five Japanese banks collaborated to roll out a financial services infrastructure based on IBM’s distributed ledger technology.

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A Blockchain System for Azerbaijan’s Digital Economy

A Caucasian nation is on the path to digital transformation, and blockchain-powered identification system is one of its cornerstones.

Azerbaijan has been a hotbed for a series of ambitious fintech-related announcements over the past several months, as the nation’s authorities were apparently moving to implement a series of innovative technological solutions in banking and e-government systems.

Repeated statements by government representatives suggested that at least part of the program relied on blockchain infrastructure. Most recently, as Cointelegraph reported, the chairman of Azerbaijan’s State Customs Committee revealed plans to implement blockchain technology to build an online-accessible cargo transportation database. Earlier in May, a high-ranking official for the Central Bank of Azerbaijan (CBA), speaking at the Fintex summit in Baku, mentioned the forthcoming implementation of a “blockchain system and artificial intelligence in the banking sector.” How are these disparate elements supposed to work together, and what is the scope of these blockchain-based solutions’ intended uses?

Early announcements

The snippets of news about a massive government initiative involving blockchain technology being underway in Azerbaijan began to pop up here and there back in October 2018. Farid Osmanov, CBA’s chief information officer, first announced the five-year program for the digital transformation of the economy — including a partnership with IBM on a distributed ledger system to be used in the banking sector — at the Azerbaijan-Germany Business Forum on Energy and ICT. In November, chairman of the Azerbaijani Internet Forum, Osman Gunduz, told the press that a few other state agencies were on the course to implement distributed ledger-based solutions in areas such as housing, utilities and even the court system to facilitate record-keeping and notary services.

While it became clear from early statements that the pilot blockchain system was to be built in collaboration with IBM on Hyperledger Fabric, it was not until April 2019, when media reports began to surface, that a branch of another big-name technology firm — Lenovo Professional Services — was also involved in the project on the hardware side. With two major industry players on board, it became clear that a comprehensive state program is at work here.

Government services hit X-Road

According to Nijat Asadli, manager of Azerbaijan’s Digital Trade Hub (DTH), there are three main areas in which the government seeks to boost innovation by deploying digital infrastructure: the DTH itself, the e-Government portal and central bank operations. The DTH is an electronic public-private partnership platform designed to facilitate the development of e-commerce in Azerbaijan and the broader region. It connects a number of governmental agencies, banks and private companies to provide a range of domestic, international and electronic services for businesses and private citizens alike.

One of the solutions available on the DTH platform is called the Single Export Application. It allows local producers to obtain all the documentation they need to hit the international markets — including licenses, permissions, customs declarations and even to apply for a government export subsidy. Another unique service available through DTL, Asadli told Cointelegraph, is electronic and mobile residency:

“Azerbaijan is the second country in the World after Estonia to offer electronic residency and first ever to offer a mobile residency. This service allows non-residents to establish a company online within a day in Azerbaijan and use all of the e-Services in the country. All they require is a smart phone — and they can start a location-independent business in Azerbaijan.”

The e-Government portal, integrated with all the user-facing government organizations, provides online access to more than 400 additional governmental services.

It has to be noted that both the DTH and the e-Government portal are built on open-source X-Road technology, a data exchange layer (DXL) solution that enables organizations to communicate over the internet and offer online services. Originally developed in Estonia in the early 2000s, X-Road underpins the Baltic country’s e-government infrastructure, as well as integration with neighboring Finland’s data exchange layer.

While X-Road developers describe it as a “distributed integration layer between information systems,” which led to speculations that it relies on blockchain technology internally, it is, in fact, not the case. As the Nordic Institute for Interoperability Solutions (NIIS), the organization responsible for developing the X-Road core, went on to explain, both blockchain and X-Road use cryptographic hash functions for linking data items to each other, otherwise they “serve very different purposes and use cases.” Each X-Road server maintains its own message log archive and stores it locally; other participants of the ecosystem, unlike the nodes on a distributed ledger network, do not have access to those archives.

Blockchain for digital identification

Right now, the only digital infrastructure initiative of the Azerbaijani government that relies on blockchain technology is the one that the nation’s central bank is overseeing. As the CBA’s chief information officer, Farid Osmanov, told Cointelegraph in an email, the government enacted a document in September 2018 entitled the State Program on Expansion of Digital Payments for 2018-2020 — a roadmap for coordinating technological advancements in digital banking. According to Osmanov:

“By implementing new financial technologies in the market, they believe they can boost the cashless economy and extend digital services, making them transparent and available for citizens.”

As a key condition to enable digital banking services, the program outlined a “private blockchain framework with trusted nodes, permissioned access and consensus services” for user identification.

The pilot project that the CBA embarked on to advance the goals of the state program has three prongs: the development of a strategic digital innovation plan, the creation of the blockchain-based digital identification system, and the deployment of the blockchain hardware. Lenovo was summoned to advance the latter goal in October 2018. According to Osmanov, the infrastructure that they put up relies on some of the company’s most innovative tech:

“The solution uses Lenovo ThinkAgile HX7820 Appliance software and hardware, which is the first 4-socket HX system installation in the world. The solution operates on the latest Intel Xeon Scalable processors from the Skylake generation and Acropolis OS from Nutanix is chosen as the virtualization platform. This solution is based on the RDMA technology, and this installation was the first in the world, where RDMA configured in productive environment.”

The open-source Hyperledger Fabric protocol, hosted by the Linux Foundation, serves as the software foundation for the identification system. Having used Hyperledger extensively to develop numerous corporate blockchains, IBM is now contributing expertise to the Azerbaijani government’s initiative. Its sponsors expect that the system will see full operational implementation by the end of 2019.

The main use of the prospective identification system will be in enabling citizens and businesses to deliver their personal data to banks and credit organizations in the form of digitally signed documents. Essentially, the blockchain system will automate the Know Your Customer (KYC) process, all the while dramatically decreasing processing time. The digital identification system will be incorporated into the e-Government system, and the open API architecture will allow banks to integrate it with their digital infrastructures through a standardized process.

Another remarkable efficiency that the system is expected to introduce will be a high level of user control over what data — and how much — they would like to share with financial organizations, Osmanov noted:

“Banks will have access to required personal data only after customer’s confirmation, so individuals and legal entities can personally control and authorize data sharing.”

The central bank’s CIO also mentioned that the authorities recognize the need for an improved legislative framework that comes with such massive technological developments. The CBA is already doing its research on international best practices and benchmarks, and is engaging with other state agencies in a conversation regarding regulatory improvements that the new system’s advent could evoke.

Limited use

With the new digital identification system on the way, Azerbaijan is about to take its place among the ranks of countries that have implemented permissioned blockchain solutions to improve the efficiency of a certain aspect of government operations. The expansion of this effort might well see the state’s performance in other domains of record-keeping — like the customs database announced recently — benefit from the introduction of distributed ledger technology. Still, yet another adherent of the “blockchain before crypto” approach, the nation is only ready to go so far: According to a November 2018 statement by the CBA’s first chairman, issuing a state-backed digital currency is out of the question for Azerbaijan.

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Microsoft and Ethereum Foundation Swell the Hyperledger Ranks Amid Growing Cross-Industry Blockchain Collaboration

Microsoft, the Ethereum Foundation and Salesforce join Hyperledger as new members, seeking to create open-source enterprise blockchain solutions.

United States tech giant Microsoft and the Ethereum Foundation are among the latest companies to join the ranks of the Hyperledger greenhouse hosted by the Linux Foundation. Many notable names in the tech and wider business fields today are developing enterprise-grade solutions based on the expanding set of tools built on Hyperledger.

These institutional blockchain projects cut across both financial and nonfinancial distributed ledger technology (DLT) utilization. Presently, there are pilot projects geared toward identification systems, supply chain management (SCM) and provenance, to mention a few.

On the whole, members of Hyperledger appear to be at the forefront of a renaissance in open-source project development, facilitating a more decentralized approach to project building. Such a trend evinces a return to a more decentralized internet with blockchain technology living up to the hype of being a disruptor of the global business process.

There are, however, some drawbacks to the emerging open-source project building trend, especially for startups that have yet to earn significant pedigree within the industry. Also, while DLT constitutes a technological breakthrough, kinks such as scaling need to be worked out before DLT-based systems can realistically upstage their mainstream centralized counterparts.

New members join Hyperledger

Microsoft, Salesforce and the Ethereum Foundation are among eight new members of Hyperledger, as announced on June 18. These companies already have a history of blockchain adoption, with several DLT-based projects across diverse business processes.

There are now more than 270 members of Hyperledger developing their own enterprise-grade blockchain solutions. Commenting on the collaboration with Hyperledger, Marley Gray, Microsoft’s principal blockchain engineering architect, declared:

“Our journey in the blockchain ecosystem has brought us a long way, and now is the time for us to join the Hyperledger community. We are proud of our contributions to such a diverse blockchain ecosystem, from our Azure service offerings and developer toolkits to our leadership in driving open specifications.”

Microsoft is by no means a new entrant to the blockchain arena, with the company already developing an ecosystem for blockchain as a service (BaaS) on the Azure cloud computing service.

In the BaaS arena, Azure competes with other offerings by the likes of Oracle and AWS. These platforms allow businesses to create bespoke DLT-frameworks to fit their operating purposes without having to navigate the skill, knowledge and cost barriers associated with building decentralized apps (DApps) from scratch.

Related: Decentralized Identity: How Microsoft (and Others) Plan to Empower Users to Own and Control Personal Data

Teams working on the Azure BaaS infrastructure get access to preconfigured modular networks that simplify the process from conception to deployment of their DLT-based solutions. By joining Hyperledger, Microsoft Azure now offers three different enterprise blockchain development environments, with the other two being Corda and Ethereum.

The Ethereum Foundation joins the Ethereum Enterprise Alliance (EEA) as a partner of Hyperledger. For Hyperledger CEO Brian Behlendorf, the decision of the Ethereum Foundation to join the expanding Hyperledger enterprise blockchain greenhouse will be a positive one for blockchain developers in the industry.

Data from StateOfTheDApps — a platform that tracks decentralized apps — shows that Ethereum hosts the highest number of DApps. Of the total 2,667 DApps tracked by the platform, 2,505 run on the Ethereum blockchain.

Apart from the newly announced members, others include notable tech giants like IBM and Oracle. IBM, Walmart and Alibaba are among the companies with a significantly high number of blockchain-based patents, which is indicative of their activity in research and development (R&D) efforts in DLT-related enterprises.

Hyperledger projects supporting enterprise blockchain development

Hyperledger, for its part, is a collaboration between enterprises and the open-source community facilitated by the Linux Foundation. The Hyperledger greenhouse acts as a bridge that connects developers, nonprofit organizations, academia and all other stakeholders interested in developing and implementing enterprise-grade blockchain technology solutions.

Cointelegraph spoke with Marta Piekarska, director of the Hyperledger ecosystem at the Linux Foundation, about how the partnership works. According to Piekarska, Hyperledger doesn’t develop code or provide consulting services. Explaining further, Piekarska said:

“We support them in terms of PR and marketing for their projects. Not all of the developers creating solutions using Hyperledger tools are members of Hyperledger. You don’t have to be a Hyperledger member to use our technology, participate in our special interest groups, or to download and use the code. There is no technological barrier to using Hyperledger frameworks and tools.”

There are numerous projects around the world based on specific Hyperledger frameworks, such as Hyperledger Fabric and Hyperledger Iroha, to mention a few. Back in May 2019, Cointelegraph reported on the partnership between Iran’s central bank and Tehran-based blockchain firm Areatak to create a DLT platform for the country’s banking and finance markets using Hyperledger Fabric. According to the report, the Borna blockchain platform, when fully realized, should help revamp Iran’s outdated banking sector.

Matt Milligan of Milligan Partners — a blockchain-based startup focusing on toll interoperability and one of the newest members of Hyperledger — highlighted the benefits of joining a vast collaborative effort like Hyperledger. Milligan, the managing partner at the company, said:

“Joining Hyperledger is tremendously valuable to us as we develop blockchain solutions for Mobility as a Service. By working in this diverse open source community, we can be more creative and more innovative than we could ever be on our own.”

The fact that Hyperledger is open-source, means developers can learn from one another, trading ideas in an environment increasingly being populated by teams working on cutting-edge DLT protocols. This collaboration serves to achieve Hyperledger’s aim of fostering cross-industry blockchain development.

By so doing, stakeholders at Hyperledger are hoping that blockchain technology can move away from the realm of being a marketing buzzword to more tangible utility cases. In an interview during the Brainstorm 2019 conference organized by Fortune, Ripple CEO Brad Garlinghouse drew attention to the existence of too many economically inviable projects with the term “blockchain” slapped on them. According to Garlinghouse, “There is a lot of noise in the blockchain industry.”

Focus on nonfinancial DLT utilization

Apart from financial products, many of the blockchain protocols being built using Hyperledger tools involve nonfinancial use cases. This trend reinforces the narrative that DLT is a disruptive technology capable of affecting several facets of the global business process.

From a nonfinancial perspective, blockchain technology seems to be getting a great deal of adoption in protocols that require trust networks and provenance. Together, these two broad application cases cover much of the mainstream business arena — from SCM to health care and identity management.

Cointelegraph asked Piekarska about the major nonfinancial enterprise blockchain solutions being developed using the different Hyperledger framework tools, to which the director responded:

“There are quite a few markets that we are seeing as very big and potential markets. We are currently seeing a lot of interest in blockchain technology from stakeholders in supply chain management. We have the food trust project for IBM and Maersk. We have Everledger which is a blockchain project based on Hyperledger Fabric to track the provenance of diamonds and now also wine. There are at least 200 live networks based on Hyperledger Fabric alone. Digital identity is another space where we see a lot of interest. This is mostly as a result of Hyperledger Indy which is our framework for building digital identity solutions using zero-knowledge proofs. One of the main contributors here is Sovereign Foundation. They have the largest running network that is based on Hyperledger Indy.”

Right here for the taking

The combination of immutable data record-keeping and the ability to create trustless networks that do not require expensive third-party authenticators continues to be a pivotal aspect of the blockchain appeal. However, these projects still need to scale for them to be able to provide robust functionality on enterprise-level protocols.

Blockchain technology also seems to be having a material impact on open-source project development for both notable tech firms and smaller startups. According to Piekarska, there has been a noticeable increase in the number of projects listed on GitHub since the emergence of blockchain technology.

It isn’t inconceivable to imagine that DLT is creating easier avenues for open-source collaboration among development teams across the globe. Piekarska said:

“I think the coming of blockchain has caused a renaissance in open source project development especially for enterprise-grade software. It is changing the way enterprises see open-source project development which is reflected in the influx of notable tech giants like IBM and Microsoft into the Hyperledger environment. All projects in Hyperledger are under Apache license. It also lowers the barriers for small companies that can now take the code and build useful protocols.”