BlockChain

Sometime ago, the world’s leading retail giant, Walmart, expressed its interest in blockchain technology. This interest has recently manifested into a major move as Walmart is mandating suppliers to join the IBM Food Trust blockchain.

The ultimate goal is to enhance traceability and transparency across the food supply chain. Blockchain technology can be used to enforce a decentralized and secure distribution of information digitally. Information on the blockchain cannot be modified but it can be shared.

IBM Blockchain-based Food Trust Platform

The IBM Food Trust uses blockchain technology to enhance accountability and visibility by connecting everyone involved in the process from growers, processors, retailers to distributors.

This connection is maintained through a permanent,shared and permissioned record specifically for food data. It can be used to track the source of a produce to make sure it meets regulatory compliance for consumer safety.

The system offers shared data on a ledger that is immutable ensuring that food produced are of high quality. The extra transparency helps build consumer trust in the brand.


This platform has been available for testing for almost two years. During this period, food products have been tracked by suppliers and retailers in millions according to IBM.

In October last year, IBM said that Carrefour, a global retailer with more than 12,000 stores across 33 countries will be using the IBM Food Trust network. While the company will start with Carrefour-branded products, it will use the system for all the Carrefour brands before the year 2020 comes to an end.

Walmart Joins The Trend

Many retailers have joined the IBM Food Trust network. Walmart recently announced that IBM Food Trust will serve as a foundation for its blockchain-based Walmart Food Traceability Initiative. Right now, the company will focus on suppliers of leafy greens.

The company says that the recent E coli outbreaks and romaine lettuce incited them to start testing IBM’s Food Trust to help them trace products after outbreaks.

In September 2018, Walmart forwarded a letter to its leafy green suppliers. In the letter, the company stated that these suppliers should be able to trace their products back to the farmers within seconds rather than days. To be able to do this, these suppliers were required to capture end-to-end, digital events with the IBM Food Trust platform.

The process will be in two phases. Direct suppliers will need to agree to the one-step back traceability on IBM’s Food Trust by January 31st 2019 according to the letter. Other suppliers are required to work towards enabling end-to-end traceability back to these farms before the end of September 2019.

Walmart has confirmed that it is mandating this change. In the letter, the company made it clear that it has no intention of making its suppliers spend money on expensive infrastructure that will add no value to the business.While suppliers may not be happy about the new development, food safety requires extreme caution.

Blockchain technology provides the kind of tools that are required to get the job done in the food supply chain. Walmart recognises this and so do other retailers.

Do you think other well-known retailers will follow Walmart’s lead by using blockchain technology to ensure safety and transparency in the food supply chain?

A mission from the International Monetary Fund (IMF) has judged that the growth of blockchain in Malta has created significant risks of money laundering and terrorism financing in the island’s economy. The news was reported in local English-language daily the Times of Malta on Jan. 24.

According to the article, the IMF announced its findings following a visit to the island, and isolated blockchain — alongside financial and remote gaming sectors and the government’s citizenship-by-investment scheme — as being high in their list of concerns regarding possible anti-money-laundering (AML) compliance violations.

As reported, the Maltese parliament has passed three blockchain- and crypto-related bills in a bid to spearhead innovation and establish a robust and transparent crypto regulatory climate.

The country’s prime minister, Joseph Muscat, has positively endorsed cryptocurrencies as being the inevitable future of money, making a strong case for the transformative impact of blockchain technologies across a gamut of political, civic and corporate applications.

The IMF cautioned Malta — whose efforts have earned it the moniker of “blockchain island” — to ensure its local authorities bring crypto service providers into line with AML requirements.

While conceding that Malta’s Financial Intelligence Analysis Unit has implemented a series of sound measures, the mission nonetheless advocated for intensified and immediate action to close loopholes in supervisory and enforcement systems.

Among its recommendations, the IMF said the authorities would need to apply more sanctions and sharpen their understanding of possible risks and regulatory breaches. The mission reportedly voiced concerns over capacity restraints, warning that:

“The increasing number of financial entities under supervision, the rapid development of new products, the evolving regulatory environment and the tightening of the labour market have put the Malta Financial Services Authority under considerable strain.”

Aside from its blockchain and crypto-focused remarks, the mission is reported to have identified a series of issues with the island’s real estate market, labor shortages and strained infrastructure. It nonetheless deemed that Malta’s growth prospects remain broadly favorable.

Cryptocurrencies continue to occupy a prominent place in Malta’s political life, having recently even provided fuel for a Maltese opposition leader to critique the government for its alleged silence vis-a-vis the fall 2018 crypto market slump.

The IMF has previously advised the Marshall Islands not to issue its own national cryptocurrency due to money laundering concerns. In November, however, IMF Deputy General Counsel revealedthe organization has been positively devoting a lot of attention to fintech, and in particular to blockchain.

IMF managing director Christine Lagarde has also recently said there may be a role for central bank issued digital currencies in the future global economy.