From olive oil to refugees : Oracle highlights the possibilities of blockchain
Blockchain has come a long way over the past 10 years. Initially developed to serve as the public ledger for all transactions on the network of bitcoin cryptocurrency, it’s fair to say that it’s various uses in the present day were not envisioned at its birth.
Put simply, a blockchain is a growing list of records, termed “blocks”, linked using cryptography, with each block of data time-stamped and linked irreversibly to the previous, so as to make it impossible to alter subsequently.
Due to its association with bitcoin, many assumed it would be ideal for the financial services sector; and this has proven to be correct. However, this is only part of the story. Blockchain is now used in many other areas too, as explained by Oracle Vice President of Blockchain Product Development Frank Xiong.
“When it first came out, everyone assumed the financial services industry would be the key focus, and we saw that too. However, after working with the customers, we also saw it gaining popularity in supply chain. This is mainly due to the fact that the process involves a long chain consisting multiple vendors, producers and manufacturers, freight lines, warehouses, etc., which are not owned by one company.
“Since they belong to different enterprises, the level of trust is not so high that they can centralise everything into a single database; this is where blockchain comes in.
“So supply chain is an area in which we see a lot of demand,” he said, speaking to The Sunday Morning Business in a sit-down interview at Oracle Global Headquarters in San Francisco US recently.
Oracle, although a late entrant in the blockchain space, launching the platform only in July 2018, has seen impressive demand in its first year, which is demonstrative of the possibilities of the technology on a global scale.
A good example of this is Certified Origins Italia, an Italian company which produces Bellucci Premium Extra Virgin Olive Oil (EVOO). The company was born out of the desire to produce and export high-quality EVOO with the best possible certification, both at the levels of individual raw materials and processing. Certified Origins is now using Oracle Blockchain to track shipments of its EVOO from its bottling facility in Italy to its port of arrival in the US, said Certified Origins Italia Srl Chief Information Officer Andrea Biagianti.
“Managing traceability with blockchain technology was the logical progression in the whole traceability process of the company. Oracle Blockchain Platform easily integrates with our partners’ systems, and we can create smart contracts between supply and distribution actors, thus reducing operational costs.”
The pharmaceutical industry is employing blockchain as well, as Oracle partners with the Government of India to fight the growing problem of counterfeit drugs in the country.
India is the third largest pharmaceutical manufacturer in the world in volume, accounting for 10% of the world’s production and therefore, the issue of fake and counterfeit drugs is a global problem.
“20% of the drugs manufactured in India are believed to be counterfeit,” said Xiong, before detailing Oracle’s role in addressing this issue.
NITI Aayog, Government of India’s premier policy institute, Apollo Hospitals, and global pharmaceutical manufacturer Strides Pharma Sciences, in partnership with Oracle, are piloting a real drug supply chain using blockchain decentralised ledger and IoT software.
Oracle Blockchain software permanently registers a drug’s record in the manufacturer’s drug supply chain (serial numbering, labelling, scanning), leaving no scope for tampering with records. From hereon, it records the drug’s movement from manufacture to logistics, from stockist to hospital, and from pharmacy to consumer – literally at every point hands change.
In the case of a fake drug, the software detects the irregularity and notifies the concerned nodal point. Additionally, Oracle IoT provides the functionality to track critical information such as the chemical ingredients of the drug, or the maintenance of temperatures in cases of life-saving drugs or vaccines.
“This agreement with Oracle and our partnership with Apollo Hospitals and Strides Pharma will help ensure that Indian drug manufacturers and healthcare experts have access to a standards-based, modern technology platform – blockchain and IoT – to help eliminate fake drug distribution,” noted NITI Aayog CEO Amitabh Kant.
To further cater to this demand, just last week, Oracle launched the Intelligent Track and Trace application for businesses using managing supply chain, as the first of four prebuilt blockchain applications for supply chain management.
The application helps in addressing the challenges of managing complexities in a global network of trading partners and helps gain efficiencies by pinpointing the status of transactions and goods across the supply chain and trading partners. It is also a prebuilt application which is ready to deploy out of the box, which means that one does not need developer assistance for installation.
Oracle believes the Intelligent Track and Trace application can be applied to food and beverage, transportation, and other industries to assist in obtaining organic certifications, achieving manufacture compliance, and adherence to global trade regulations.
Another area in which blockchain has been extremely useful is identity management. Here, it enables organisations to effectively manage the end-to-end lifecycles of user identities across all enterprise resources, both within and beyond the firewall and into the cloud.
Blockchain is also used is in refugee management.
“An issue that Germany has is in handling the many refugees from the Middle East and other places. They are distributed to different states in Germany once they cross the border. However, the question was of how to deal with the information pertaining to their identities, locations, the programmes they enrol in, and the benefits they receive.
“They’re working with Oracle to develop a platform to deal with that problem. So each refugee will be tracked step by step,” said Xiong.
Federal Office for Migration and Refugees (Bundesamt für Migration und Flüchtlinge [BAMF]) developed a system within the shortest possible time with Oracle, called ASYL Online in which all refugees and asylum seekers could be clearly, fully, and efficiently registered on arrival. Furthermore, all authorities and organisations with justified interests were to be given access to the centrally stored data.
At the height of the refugee crisis in the summer of 2015, up to 10,000 refugees crossed Germany’s borders on a daily basis, with the aim of applying for asylum.
At the time, the systems in the BAMF were not designed to cope with that volume, and were therefore unable to quickly and correctly register that influx of people. In addition, there was neither a central data storage space nor a system for the necessary data exchange. Various authorities registered refugee details individually on first contact, but only for their own purposes. At the same time, the refugee debate became increasingly heated both among politicians and within society at large.
“To date, I haven’t experienced a single project that can be compared even remotely with ASYL Online in terms of its importance, complexity, or implementation schedule. The professionalism and phenomenal dedication of BAMF and Oracle enabled successful realisation within an extremely short period of time,” said Federal Office for Migration and Refugees Head of Infrastructure and IT Department Dr. Markus Richter.
Identity management is also proving to be useful for real estate and property.
“When you purchase real estate, you have to know whether the seller is the real owner. In the US, we have that problem because we have to pay thousands of dollars for title insurance, just to ensure the seller has the title. But with blockchain, the government agency has a record of who the owner is because every time the property changes hands, the blockchain will record it. It becomes an immutable permanent record. This saves buyers’ money and also reduces the hassle for the owner of proving title,” said Xiong.
He added that citizenship proof and validation of educational or training certificates are other uses of blockchain.
“We have a couple of customers who are already in production in those areas. If you graduate from a certain school or gain a diploma, your credentials will be recorded in the blockchain for potential employers to refer.”
Is Xiong happy with the adoption of blockchain around the world over the past few years?
“In the beginning, it was gradual but now I see adoption becoming much more rapid. At first, people thought it was attributed to the hype, but now the hype is dying down and people don’t think blockchain can solve every problem. However, they know that blockchain can provide efficiency in transactions with third parties.”
Xiong believes that between 50% and 60% of companies will use blockchain in the next few years.