The Decentralized, Permission-less Blockchain Solution for Supply Chains

http://origin-trail.com/

What is OriginTrail?

OriginTrail integrates blockchain technology with corporate supply chains, promoting supply chain data immutability as well as integrity. Corporate supply chain data is extremely opaque — especially in the food industry — with significant informational gaps in the original sources of production. OriginTrail’s Decentralized Network provides a standard blockchain-based solution with an incentivized protocol to ultimately promote greater product standards for corporations globally, thus ensuring the overall safety of the consumer.

What Real-World Problems does it Solve?

OriginTrail solves two key problems of supply chain management:

(1). Data fragmentation

(2). Data centralization

Regarding data fragmentation, there are significant differences in data storage structures across the supply chain spectrum, with low data interoperability amongst single-organizational and multi-organizational supply chains. Additionally, this kind of fragmentation makes it difficult to benefit from whole chain visibility in form of resource optimizations, process automation or effective audits. In regards to the cost of centralization of supply chain data — this involves the need for a trusted intermediary that provides information on product authentication, food sources, etc. At present moment, stakeholders in supply chains, including shoppers, place their trust of product information on an intermediary (i.e. a central authority). This trust, however, is rapidly decaying due to various scandals that are appearing. As an example, in countries such as China, information on product authentication as well as sources of food items is rampant with misleading if not downright fraudulent data, thus severely affecting the welfare of the consumer[1].

OriginTrail’s decentralized solution via a permissionless distributed ledger (i.e. a “blockchain”) solves the inherent problems of current supply chains — it provides interoperability between various supply chain data storage systems and provides a consensus mechanism to ensure the integrity of the data. Additionally, the ultimate feature of OriginTrail’s protocol is verified insight into product authentication as well as supply chain mapping at any point in products’ production cycle.

Thus, the immutability of OriginTrail’s blockchain solution as well as an incentive structure for integrity and verification of the data ensures that (1). Corporations and central entities provide authentic data as to the origins of their product as well as their life cycles and (2). Anyone may verify that information and ultimately decide which corporation is to be trusted or not, thus introducing accountability.

How does it Work?

(Incentive/Consensus Structure of the ODN)

OriginTrail accomplishes data interoperability between supply chain data systems through adoption of the GS1 standards and their EPCIS (Electronic Product Code Information Service) framework. GS1 standards is the global foundation that standardizes supply chain data for corporations worldwide[2]. OriginTrail is blockchain agnostic when it comes to storing data fingerprints on immutable ledgers and can function across any existing blockchain platforms. Its ERC20 token will be minted on Ethereum, where incentives will be set up in form of smart contracts.

OriginTrail’s Decentralized Network (ODN) will need to be optimized to support and integrate data across the corporate supply chain universe, and hence will incorporate a decentralized graph database. Graph databases are the most efficient solution for interconnected data, and they are already widely used in major companies such as Walmart, eBay, and Adidas[3].

ODN will specifically rely on two types of nodes “Data Creators” (DC) as well as “Data Holders” (DH). DC nodes are responsible for incorporating the supply chain data onto the network, and DH nodes must subsequently ensure the immutability and storage of the respective data. To combat collusion amongst nodes, the number of DH nodes must outnumber the DC nodes by a factor of “n+1”, with “n” representing the number of DC nodes. Hence the “minimum ODN replication factor” is “2n+1”, since a data creator is also a data holder.

To integrate data onto the ODN, a DC node will upload a dataset using XML or a web service, via a user interface. Following a syntax and standard formatting check, the data is converted into graph form and is introduced through the network through the data distribution protocol (discussed below). Once validated through successful consensus checks, the new data is fully integrated onto the ODN and is hashed (fingerprinted) onto the blockchain for all to scrutinize.

The Data Distribution Protocol within the ODN works as follows:

(1). A DC node uploads a supply chain graph on a specific product to the network and checks to see if any nodes are already storing data on that product.

(2). If no nodes storing the data are found, the DC node broadcasts a request for storage for their product data.

(3). DH nodes receive the request and emit their service proposals.

(4). The original DC node selects “2n” nodes with the best proposals, with “n” representing the number of actors involved in the specific data being uploaded and shared.

(5). The selected DH nodes are notified by the DC node which encrypts the data with a specific function (a “slowable PRP” function, using the DC node’s public key as well as the current time/block number for input) before sending to the selected nodes.

(6). The receiving DH node stores the product data and include a hash fingerprint to the blockchain for data integrity and immutability.

The “Trace” Token and Token Sale Allocation

OriginTrail will incorporate an ERC20 compatible token — Trace — within their network to incentivize data creators and holders (i.e. “data producers”) on one side and data consumers on the other. The Trace token ensures that the OriginTrail nodes are thus adequately processing the integrity of the data as well as maintaining updated storage.

The OriginTrail Crowd Sale will take place in Q1 2018, with a specific date yet to be determined.

Token distribution will be as follows:

- Crowd Sale: 50%

- Future development: 20%

- Liquidity Pool: 5%

- Founders & Pre-ICO investors: 18%

- Team & Advisors: 5%

- Bounties: 2%

Both Founders and Team members will have a 2-year vesting period where every 3 months, 12.5% of their allocated Trace tokens will be released.

Vesting will also apply to Pre-ICO investors as well as Advisors where 20% of their tokens will be released at the conclusion of the Crowd Sale, 40% after 3 months and the remaining 40% after 6 months.

Other key features of the Crowd Sale:

- Total tokens minted at distribution: 500M Traces (i.e. 500,000,000)

- Minimum contribution target: $5M (all periods)

- Development target (soft cap): $10M (all periods)

- Total target (hard cap): $22.5M (all periods)

- ICO price of token: 1 Trace = $0.10

All funds collected above the development target will be used to set up regional presence through opening offices and awarding use-cases on the platform (details on both in the timeline/roadmap section on the OriginTrail Website). The distribution of funds will be 60% for use-case awards and 40% for regional offices’ expenses.

Trace Token Supply Schedule

Starting three months after the initial crowd sale date, 1.125% of Trace Tokens will be released as per the Founders vesting schedule and 0.312% will be released as per the Team vesting schedule.

1.8% of tokens will be released at the conclusion of the crowd sale as per the Pre-ICO Investors vesting schedule, along with 0.5% of the Advisors allocation tokens. Additionally, 3.6% will be released three months later along with 1% of the Advisors’, with the final 3.6% +1% of Pre-ICO/Advisor tokens to be released six months after the crowd sale date (around June 2018).

Assuming a January 2018 Crowd Sale date, OriginTrail’s Trace token Supply Schedule will look as follows:

Development Timeline

OriginTrail has been in operation since 2013 and have already an established presence in the supply chain industry. OriginTrail team’s priority throughout the end of 2017 will be structuring the crowd sale as well as establishing their Asian presence. More notably, the team was recently admitted into the Walmart China Innovation Pipeline program to begin exploring integration of the OriginTrail protocol, and additionally received the Walmart Food Safety Innovation Spark Award[4].

The OriginTrail Decentralized Network (ODN) is scheduled for launch in Q3 2018.

Q1 2018:

· Partnership with GS1 and implementation of transaction data standards

· Fostering of Asian partnerships through Hong Kong office

· Beta tests with existing partners

· 1st Quarterly Report

Q2 2018:

· Test Network Launch

· Live Use-Cases using Protocol Test Network

· 1st Open Call for Use-Cases (voted upon by Trace token holders)

Q3 2018:

· OriginTrail Decentralized Network (ODN) Launch

· 2nd Open Call for Use-Cases

· Protocol Update with IoT Standards

· US Offices established to set up American partnerships (if hard cap reached)

Q4 2018:

· 3rd Open Call for Use-Cases

· Protocol Update with Certification and International Standards

· Indian, African, and Middle East offices set up (if hard cap reached)

2019 — beyond

· Co-creation of data standards with private and public institutions

· Development of Supply Chain Transparency Index

· Consumer NGOs cooperation for empowering shoppers

OriginTrail Team

OriginTrail is headquartered in Ljubljana, Slovenia and currently has offices in Belgrade, Serbia and Shanghai, China.

Tomaz Levak — Co-Founder and Chief Executive Officer

· Head of Projects — Monada d.o.o. (2012–2013)

· Master’s Degree — Human Resources Management, University of Ljubljana (2012–2014)

· Bachelor’s Degree — International Relations, University of Ljubljana (2007–2012)

Ziga Drev — Co-Founder and Chief Operating Officer

· MBA — University of Ljubljana (2012–2014)

· Bachelor’s Degree — International Relations, University of Ljubljana (2008–2012)

Branimir Rakic — Co-Founder and Chief Technology Officer

· Network Testing Engineer — P3 Communications (Dec. 2011 — Sep. 2013)

· Master of Science in Electrical and Computer Engineering — University of Belgrade (2006–2014)

Sava Savic — Data Interoperability Expert

· Data Interoperability Expert — OriginTrail (Feb. 2017 — Present)

· Solutions Analyst and Data Integration Specialist — GoPro (Sep. 2011 — Present)

· PhD in E-Business Information Management Systems — University of Belgrade (2011–2014)

Nino Pirtovsek — Finance and Accounting

· Senior Consultant — Price Waterhouse Coopers (Jan. 2017 — Present)

· Consultant — Deloitte (Jan. 2015 — Jan. 2017)

· Bachelor’s in Economics and Business — University of Maribor (2008–2012)

Aleksandar Veljković — Blockchain Developer

· Teaching Associate — Mathematics, University of Belgrade (Oct. 2015 — Present)

· Full-Stack Developer — Prospeh d.o.o. (Jul. 2014 — Nov. 2015)

· PhD in Computer Science — University of Belgrade (2016–2020 expected)

· Master’s Degree in Computer Science — University of Belgrade (2014–2016)

Filip Radojković — Full-Stack Developer

· Javascript Developer — Device Tools AG (March 2017 — Present)

· Bachelor’s Degree in Electrical and Computer Engineering, ICT College of Vocational Studies (2012–2015)

Zarko Stamenic — Product Design

· Product Designer — OriginTrail (Aug. 2015 — Present)

· Architectural Design — Freelance (July 2013 — Aug. 2015)

· Master’s in Architectural Design — University of Belgrade (2011–2013)

Anze Voje — Public Relations and Communications

· PR and Communications — OriginTrail (Aug. 2017 — Present)

· Communications Manager — Cofound.it (Feb. 2017 — June 2017)

· PR Manager — Merkur (Feb. 2013 — June 2017)

· Master’s Degree in International Business — University of Ljubljana (2011–2012)

· Bachelor’s Degree in Journalism — University of Ljubljana (2006–2011)

John Koegh — Advisor

· President and Principal Advisor — Shantalla (Dec. 2010 — Present)

· Doctor of Business Administration, Supply Chain Transparency — Henley Business School (2015–2020 expected)

· Master of Science, Business and Management Research — Henley Business School (2015–2017)

Tomaz Stolfa — Advisor

· Entrepreneur-in-Residence — Matrix Partners (May 2017 — Present)

· Co-Founder — Layer (2013 — Present)

· Business and Information Management, — University of Ljubljana (2001–2008)

Jan Karnath — Advisor

· Digital Transformation Consultant — TLGG (Aug. 2017 — Present)

· Executive Board Member — Fonpit AG (Sep. 2011 — July 2017)

· Strategy Associate — SAP (2009–2011)

· Bachelor’s in Management and Marketing — Webster University (2005–2008)

Andrej Muzevic — Advisor

· Partner/Director — Interbora (June 1996 — Present)

· Master of Science, Economics — University of Ljubljana

Srdjan Krco — Advisor

· CEO — DunavNET (2012 — Present)

· Senior Research and Innovation Consultant — Ericsson Serbia (2010–2014)

· PhD, Telecommunications — University of Novi Sad (1989–1994)

Competitive Analysis

The two primary competitors to OriginTrail that boast blockchain-based solutions for supply chains are Ambrosus as well as Modum.

Ambrosus (https://ambrosus.com/index.html) is a Swiss-based company (headquarters in Zug) that aims to record all products across the spectrum of industries including healthcare, consumer staples, commodities, etc. Its consensus structure is structured vastly different than OriginTrail’s, as the desired scale of its protocol arguably requires greater central control. Additionally, the Ambrosus Token — “Amber” — is generated every time a product label is scanned and uploaded into the system and its utility is more complex than OriginTrail’s Trace token.

Modum (https://modum.io/) is also Swiss-based (headquarters in Zurich) and focused primarily on the pharmaceutical industry.

DISCLOSURE — I may participate in the OriginTrail Pre-Sale.

[1] See https://qz.com/1031861/blockchain-could-fix-a-key-problem-in-chinas-food-industry-the-fear-of-food-made-in-china/

[2] See https://www.gs1.org/standards

[3] See https://www.graphenedb.com/blog/2016/01/11/2016-trends/

[4] See https://medium.com/origintrail/awarded-by-walmart-admitted-into-its-inaugural-innovation-program-3b235d85d1e0

Economist, Ocean Lifeguard, Founder of Austere Capital Advisory (https://austere.capital/)

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