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DL-Tags: DLT and Smart Tags for decentralized, privacy-preserving and verifiable supply chain management
Supply chain management enhanced by Internet of Things (IoT) solutions integrates special tags (e.g., RFID, NFC, QR-codes) with products to create Smart Tags, which, in addition to storing supplemental information about a product, are also used to track products during their lifecycle. However, a product consumer has to implicitly trust the Smart Tag creator and other stakeholders within the supply chain that they are providing authentic data within a product’s tag. The DL-Tags solution steps into this environment to offer a decentralized, privacy-preserving and verifiable management of Smart Tags during a product’s lifecycle. The solution is based on Distributed Ledger Technology (DLT) and uses the Ethereum blockchain to mediate interactions between stakeholders during a product’s exchange process. By reaching a consensus on the product’s description and state logged on the blockchain, all involved stakeholders and product consumers can verify product’s authenticity without revealing their identity. The paper describes the DL-Tags solution and includes a cost analysis of all implemented transactions on the Ethereum blockchain. The proposed solution provides evidence of the product’s origin and its journey across the supply chain while preventing tag duplication and manipulation. It is among the first documented practical solutions using DLT and IoT for supply chain management which is designed to be distributed ledger agnostic.