It is unusual that a trend to watch in food safety would be one that primarily involves arcane information technology developments, but that is exactly the case in 2018. As a result of several initiatives begun in 2017 by technology companies and large food industry participants, applications of blockchain technology to food supply chain management and safety traceability are likely to gain attention this year.
“Blockchain” refers to a variety of techniques, popularized for the bitcoin cryptocurrency, for maintaining a ledger of information consistently across multiple computers on a decentralized network. While applications such as its use as a financial ledger are more well-known, the disparate global components of a food ingredient supply chain make food safety a highly promising application of the technology, and make the technology something to watch for food safety.
The practical and legal issues related to developing blockchain technology will be complex. On one hand, blockchains can enhance privacy and security because they use encryption techniques for storage and access authorization, and they can improve access to information by providing a method for multiple parties to access a database without the need to rely on a central authority. Blockchains are thought to be faster and more secure than traditional database methods for distributed applications. On the other hand, deployment of any new technology widely across the food supply chain will take time and expense, and the system relies on new methods and new technologies that may be unfamiliar.
The technical claims about features of blockchains must be carefully scrutinized by lawyers. While technologists assert that blockchains are immutable, these descriptions are incomplete. Aside from the ever-present threat of hacking of any computer system, several highly publicized events belie these features. On at least two occasions, on two different blockchains, a centralized group controlling the software of a blockchain was able to change the contents or function of a blockchain to correct a flaw. While those were beneficial changes, they make clear that in certain circumstances, blockchains can be changed.
The growth of blockchains for food safety may also be hampered by regulatory developments in other fields, particularly the cryptocurrency applications that were the founding development of the technology. Despite its promise to enhance food safety information access, the technology and investment in it may be hampered as the U.S. regulatory community turns its attention on restraining the excesses and frauds occurring with so called “initial coin offerings” that use a blockchain as a vehicle to raise funds for new businesses.
The legal implications of any blockchain initiative should be carefully considered, with a broad perspective. Technology, intellectual property, open source software and federal financial regulation issues abound.