Supporting open standards and exploring use cases will help ensure interoperable supply-chain solutions and discourage counterfeiting, one DHS exec says.
Blockchain technology has the potential to transform supply chain management, but the road to transparent tracking of everything from passengers to shipping containers is still mostly unmarked and uphill.
One of the challenges is encouraging blockchain frameworks that support common standards, according to Department of Homeland Security’s Science and Technology Directorate.
“Private industry is leading the way with blockchain development as many see it as a key advantage,” S&T Cyber Security Division Director Douglas Maughan said during May 8 hearing of two subcommittees of the House Science, Space and Technology Committee. “Government must be informed and ensure blockchain technology supports standardized approaches for security, privacy and data exchange to create efficiencies and enhance the public good.”
To support global specifications for blockchain, S&T is supporting the World Wide Web Consortium’s standardization process for Decentralized Identifiers and the Verifiable Claims Data Model. It is also working directly with startups and other DHS component agencies to support development of blockchain projects.
Michael White, head of global trade digitization at container shipping company Maersk, said his firm is committed to “embracing existing standards” in blockchain development. Maersk and IBM are conducting a global supply-chain pilot using blockchain to track shipments from source to destination.
“To have a platform that helps to accelerate the digitization of global trade, we need to be completely open and neutral and take advantage of common standards around the world,” White said in response to a question from Rep. Barbara Comstock (R-Va.). “We want make sure that everyone can avail themselves with this platform and exchange info a transparent way.”
Both Maersk and UPS are involved with the Blockchain in Transport Alliance, a coalition of industry groups focused on creating common standards. However, Chris Rubio, vice president of global customs and brokerage staff at UPS, expressed some concerns about how to digitize the shipping process.
While individual items can be tagged digitally using radio-frequency identification, near-field communication or two-dimensional barcodes, using blockchain technology would require an “overhaul” in current supply-chain practices and require “an industry- and supply-chain-wide commitment” to adopt digitization on a chain, according to Rubio.
In the government space, S&T is working with Customs and Border Protection to test the feasibility of blockchain to facilitate international passenger travel and to ensure the authenticity and integrity of imagery collected from cameras.
CBP’s Office of Trade Relations and S&T are partnering on proof of concepts related to shipping, logistics and customs and whether distributed ledger technology can be used to verify compliance with the trade agreements that require a certain percentage of an item’s components be produced or assembled in a free-trade country.
One of the goals of the free trade projects is to be able to “detect more counterfeit goods more easily,” Maughan said.
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