EY Utilizes Blockchain to Authenticate Original Japanese Sake
After engaging in the development of a settlement layer on the Ethereum blockchain, alongside Microsoft, and ConsenSys, consultancy giant EY aims to expand its blockchain services to Japan, where it plans to register, authenticate, and track fruits and local beverages such as the world-famous Japanese sake, in a DLT fashion.
EY’s Japanese branch, which is responsible for the initial proposal says that the firm will be able to share information including origin details, delivery records, and proof of authenticity to foreign consumers who enjoy the far-eastern cuisine.
Besides the fact that the Japanese fruits’ exports jumped from an annual margin of $90M by the end of 2009 to over $223M in 2019, domestic sake brewers have reported dissatisfaction regarding counterfeit products being promoted to foreigners as original Japanese sake, even if most of the times they were produced, marketed and promoted outside the country of the rising sun.
It might sound funny at first, but EY’s “SAKE Blockchain” is set to be utilized anywhere between Hong Kong, Thailand, and Singapore as long as the beta testings are concluded, and the ongoing epidemic forces new business practices to be implemented by international-scale economies.
As for the sake in this use-case, EY’s plan is to timestamp and register information regarding its origin, ingredients, quality control in the supply chain, including details regarding the temperature of the brew, all on a decentralized distributed ledger system tailored for the sake industry.
Additionally, EY envisions a scenario where the end consumer will be eligible to access details subjecting the brewer’s history, and even receive recommendations of food to pair with the product, simply by scanning a relevant QR code utilizing a smart hand-held device.
On the other hand, the sake producers will benefit from the data accumulated from the digital supply chain management platform and be able to create new innovative targeting strategies to expand their operations outside Japan.
According to NikkeiAsianReview, most sake producers are SMEs unable to identify external retailers and arbitrary opportunities once the sake has been exported from the country, making the blockchain used in this case a double-edged sword that benefits both ends of the trade.
Furthermore, the service will be available in Chinese, English and Korean languages, therefore we should expect Pan-Asian coverage, although other participants besides HK, Thailand, and Singapore have not yet confirmed.
“Being able to tell the story of the production and origin [of sake] will help to differentiate it from fake products,” Hideaki Kajiura, a partner at EY Advisory & Consulting told the Nikkei Asian Review.
While the Japanese Ministry of Finance revealed that the country’s sake exports rose over 5% in 2019 alone, representing a pie of the range of a couple hundred million dollars worth of yen (23.4B YEN~$223M USD), sake brewers are struggling with Asian counterfeits that in some cases sell their monkey product at a higher price than the real deal.
This fact alone ensures the importance of blockchain architecture in such a chain of ownership, where anything from RFID chips, and QR codes, to smart contracts and ERC-721 Non-Fungible Token (NFT) protocols, could enable a real-time. almost alive interaction with the product itself.
Although EY has been recently playing with Ethereum’s blockchain, the countries involved in the process, as well as the nature of the solution (supply chain management with blockchain) points at R3, a US enterprise-grade DLT service provider.