Are you sure that lobster you’re eating is real?
Connecting fishers with restaurants to fight food fraud.
Introduction
Traditional supply chains are full of middlemen. Food fraud is a problem because there is no transparency into who did what. Blockchain can solve this.
Two Hands is focused on people and trust.
Colin Milstead has been fishing since he was a young boy, he takes great pride in the quality of his catch. More importantly Colin is a man of his word, he always delivers on his promises. This is why Waldorf Astoria’s Executive Chef Alistair Carter, pays a premium to buy Colin’s lobster.
Blockchain enables trust. Now we can connect high end restaurants directly with fishers on the other side of the world.
Transacting
Understanding why blockchain in the real world is best understood through an example. The characters are:
- Alistair the Executive Chef
- Fred the fisherman
- Dan the delivery driver
- Laura the last mile distributer
- Rachel the regular fish market supplier
- Jane the judge
- Steven the standby delivery driver
Imagine that Executive Chef Alistair knows that he is going to be cooking for a princess next week. Alistair decides to cook a signature lobster dish. Normally Alistair would buy from Rachel, but sometimes she runs out of lobsters. If Rachel is out of stock Alistair could try buying from someone he doesn’t know in the fish market. There is the risk that they sell him a lobster that has been sitting in a tank with poor quality water for the last month.
This risk is too high. As a world famous chef Alistair accepts nothing but the best. Knowing that Apollo Bay is world famous for its Southern Rock Lobster, Alistair flies half way around the world to enlist the help of Fred the fisherman. Alistair agrees to pay a premium for Fred’s help finding the right lobster for this important dish.
They set out and begin checking lobster pots, some are too small, others too large. Eventually Fred finds a lobster that is just right, with all its legs and antenna intact. When they arrive back at the port Fred carefully packages the lobster for the journey back to China. Alistair pay’s Fred as he hands him the lobster, he then travel’s back to China to make his perfect dish. Great success.
So, let’s look closely at what happened. Fred caught and packed a lobster, he then physically put the lobster into Alistair’s hands. Alistair knows what happened. Fred knows what happened. They were both there, there was no need for a third person to help make the transfer. There was no need to get Jane the judge to sit and watch to confirm that Fred gave Alistair the lobster. Fred only caught one lobster so he can’t give Alistair a second lobster because he doesn’t have any more. Once Fred hands the lobster to Alistair he no longer has any control over the lobster. Alistair has full control over the lobster. That’s what an in-person transaction looks like.
Tracking lobsters
Alistair has absolute confidence in the authenticity of the lobster he purchased. Flying half way around the world and going on a fishing voyage is an inconvenient way to buy a lobster. Fred has a fishing quota, so to save Alistair the long trip Fred puts a unique tag on each of the lobsters he catches.
For Alistair to buy from China he must be able to verify that the tag on his lobster hasn’t been sold on another lobster. Fred and Alistair agree to create a travel itinerary for each lobster. This lists who is allowed to take custody of the lobster at each step in the journey.
When Alistair buys a lobster from Fred the travel itinerary might look like.
- Fred tags and packs the lobster in Apollo Bay.
- Fred will then give the package to Dan the delivery driver at Apollo Bay.
- Dan will then drive the package from Apollo Bay to Melbourne airport.
- At Melbourne airport Dan then gives the package to Customs.
- Customs then clears the package and loads it on to flight CX178
- When flight CX178 lands it clears customs. Laura from the freight forwarder takes ownership of the package.
- Laura then delivers the package to Alistair at his restaurant.
Each time custody of the lobster changes this is recorded as a transaction.
If Fred had the only copy of the itinerary, everyone would have to ask Fred where the lobster was. Fred could change the itinerary and no one would be the wiser. To ensure that Fred doesn’t make any last-minute changes, Fred, Dan, Laura and Alistair are also given a copy. Each lobster is only allowed in places on the itinerary with the people listed. If the lobster’s tag shows up somewhere not on the itinerary, everyone will know something is wrong.
Sometimes there are unforeseen circumstances. If Dan has an emergency and wants Steven to fill in for him, Dan sends a request to update the itinerary. If Fred, Laura and Alistair agree to Steven filling in for Dan then the itinerary is updated.
If Alistair doesn’t trust Steven and blocks the change, the package remains with Fred until Dan is able to pick it up. Without the update, only Dan can take custody of the package from Fred at Apollo Bay.
Each tag’s travel itinerary determines who can have custody of the lobster. This stops Laura from creating a copy of the tags and selling them to other people in the fish market. Anyone checking the itinerary of a cloned tag would see that it was never in the fish market. This prevents what is referred to as the “double spend problem”.
As more lobsters get shipped things get more difficult to keep track of. So we record the travel itineraries into a ledger. The ledger is like a special book with all the travel itineraries and custody transfers. For redundancy there are multiple copies of the ledger. What makes the ledger special is how new entries get added. New entries only appear once everyone with a copy of the ledger agrees to enter them.
As a result, there is no way to cheat the ledger, everyone in the supply chain has their own copy of all the data. If Fred edits his copy without telling anyone, his ledger would no longer match up with everyone else’s copy. Fred would not be able to enter new transactions into the ledger.
Private vs Public
Bitcoin is a public ledger that anyone can join, as a result the collective cost of running the network is high. Two Hands is a private ledger using Hyperledger Fabric. Only participants in the supply chain are able to join. This means that data is only shared between the parties that should have access. This makes Two Hands fast to run and environmentally friendly.
Summary
Other blockchain projects take the approach of retrofitting existing processes. Two Hands has re-engineered the supply chain from the ground up to put people at the centre. What you do on Two Hands today, will affect who wants to do business with you tomorrow.
Trust is confident vulnerability.
Two Hands fosters trust by allowing businesses to see, who does what they say they will.
Two Hands is updating the old Russian proverb from “trust, but verify” to “verify, then trust”. Unlike centralised reputation systems, there is no one you can pay to remove a bad experience. Everyone can see if your deliveries are late, you don’t pay your bills on time or your lobsters are low quality.
