IBM adds crypto-anchors to blockchain to fight fraud

A crypto-anchor ties a physical product to the blockchain

With cases of fraud rising - costing the global economy almost £13.3 trillion from 1997 - 2016 - technologies that can counter the threat are more important than ever. Blockchain has been heralded as one solution, but used alone it cannot account for counterfeit goods.

Blockchain can be used to track goods all the way through the supply chain, keeping a permanent and unchangeable digital record of every movement and handover that a product goes through.

However, the technology has no physical tie to a product; there is no way to guarantee that the brown box that left the conveyor belt in Shenzen is the same one that arrived on your doorstep in London. IBM Research is trying to solve that challenge with its work on cryptographic anchors.

Every year, IBM Research showcases five products that it thinks could reshape business and society within the next five years (‘5 in 5'). One of this year's technologies is the combination of crypto-anchors and blockchain.

The anchors are ‘tamper-proof digital fingerprints...that can extend the blockchain into the physical world', says IBM. They can be built into a product and used to authenticate its origin and contents, ensuring that it matches the blockchain record.

These anchors could take a variety of forms, such as edible ink on a malaria tablet, or IBM's new chip that is the size of a grain of salt. The first of these chips will be available within 18 months, the company has said.

"They'll be used in tandem with blockchain's distributed ledger technology to ensure an object's authenticity, from its point of origin to when it reaches the hands of the customer," said Arvind Krishna, head of IBM Research.

"These technologies pave the way for new solutions that tackle food safety, authenticity of manufactured components, genetically modified products, identification of counterfeit objects and provenance of luxury goods."