Technology is what you make it. While the term itself derives from the Ancient Greek techné which can be translated to „knowledge on how to make it“, or „know-how“, this knowledge itself is transformed into actual value only at the point of implementation. As we see major talks and discussions about up-and-coming technologies, transformative trends and digital innovations, it’s important to keep this notion in mind. The question whether tech-based solutions find use-cases in our still human-based economies strongly depends on their potential to be embedded in our social, day-to-day structures. In other words, the use of technologies is defined by their relevance for you and me – or, at least their potential to gain this relevance in the future.
We will try to give some inspirational input on Food Business use cases of one specific technology that came to life in the late 2000s: Blockchain. We will try to trigger some of your own thoughts by proposing new potential use cases, and by showing a parallel in the theoretical frameworks of informational computing and the food system. The questions we’re trying to address are:
What is the relevance potential and possible impact the Blockchain technology could have for the food system in the long run?
Will we be able find use cases that will empower and enable a functional food system?
DISTRIBUTED FOOD SYSTEMS
Blockchain technology is seen as an essential part of Web 3.0 which itself can be rather fuzzily described as a response to the centralised, monopolistic patterns that Big Corps (e.g., Alphabet, Facebook) created in the development of Web 2.0. The inherent aim of Blockchain, and broadly speaking also Web 3.0, is to provide a structure that enables decentralised, distributed systems by decentralised data storage, data and value transaction (incl. decentralised ownership verification), and proof of digital identity.
Regarding food, it’s interesting to note that the centralisation patterns we’ve seen in the web find strong parallels in our exploitative food system. Especially in Western countries, the distribution and informational exchange structures are highly centralised in the form of powerful retail companies that decide where, how and with what information food is bought and consumed. Since our political and food economical focus is based on pseudo-efficient logics, farms consolidate into ever-growing „factories“, and the diversity of our former diet, rich in species, varieties and flavours, is rapidly decreasing. A lack of diversity increases the risk of the dangers posed by climate change and other stress factors, and ultimately leads to highly vulnerable, non- resilient food systems.
What applies to food also applies to other systems. In computational informatics, Leslie Lamport introduced a method to determine the „correctness“of a distributed system. Examples of distributed systems include p2p-networks, biological / cellular networks, aircraft control systems, the internet as a whole, distributed databases / ledgers, such as Blockchain, and basically any living system, and systems that emulate the governing factors of live. Despite showing centralised features, our food system, too, is a distributed system.
Any system, or network, consists of two factors:
1. Nodes
They represent separate machines or processes and may be physically or functionally separated.
2. Message passing / channels
They’re represented as arrows between the nodes, and depict that information can flow freely between the separate nodes – it’s not necessary that the nodes are connected to each other, even
indirectly, for them to work towards the common goal of the system, and thus, for them to be part of the system.
There are three major components in Distributed Systems:
- Concurrency – information is processed concurrently, not one step at a time
- No global clock
- Single parts / nodes of the system can fail without crashing the whole of it (potential for failure)
According to Lamport’s scheme, a system is correct when two things are true about it: it doesn’t do bad things (Safety: This will not happen), and that it eventually does good things (Liveliness: This must happen). Now, how can we prove that our system is achieving its goal, and is therefore a correct system? To achieve this, one uses a consensus algorithm for the correct answer (does the system work / comply with its goal?). If a system is seen as the coordination, creation and organisation of its processes, then in Distributed Systems, too, its nodes have the primary function to agree on the output, given some input. This consensus is achieved by three requirements, and is again embedded in the Lamport-framework:
1. Validity (Safety)
Any value decided upon by the network must be proposed by one of the nodes or processes.
2. Agreement (Safety)
All non-faulty processes must agree on the same value.
3. Termination (Liveliness)
All non-faulty nodes must eventually agree on a certain value.
Since the 1980s, several consensus algorithms have been developed that are applied in computational programs by companies such as Alphabet (Raft, Paxos).
These algorithms are based on voting-mechanisms, i.e. nodes vote on the execution and status of updates. The second main consensus mechanism is the Nakamato Consensus, developed in the Bitcoin Whitepaper and applied in the Bitcoin protocol, where users vote implicitly, meaning that their voting power is dependent on the resources they are spending. The origins of Nakamoto Consensus lies in the PoW mechanism, but it isn’t the only application for it.
Its strength lies in the fact, that any node can leave the network at any given time and even give out faulty information without endangering the functioning of the consensus mechanism. Voting power must be based on a scarce resource difficult to achieve and spend, to prevent overwhelming voting power by creating a multitude of identities in a pseudonymous system where identities are easy to create. In Bitcoin, this resource is computational power, but in theory, any other resource could be used instead.
Now, how can we use this analogy for an application to food?
In a distributed food system, the nodes are represented by consumers, producers, policy makers, and so forth – in other words, every member of society. The correct functioning of our food system is determined by its participating nodes. It’s safe to assume we’d define correctness as food safety, food security, social sustainability – in general, and as defined by the UN, we could say that a correct distributed food system is compliant with the 17 SGDs). This definition based on the factors Safety and Liveliness. In relation to the resources with and by all of our food is grown, these terms could be adapted to the concepts of sustainability (do no harm), and regeneration (do good) respectively.
In the food system, the main resources, or factors governing the correct long-term functioning of food safety and security can be divided into the categories soil, water, atmospheric stability and genetic diversity. Given their current state, we can then according to the distributed systems
theory categorise them according to their necessity to fall under Sustainability = Safety, and Liveliness = Regeneration.
Soil and Genetic Diversity need to correspond with the Liveliness / Regeneration parameter, as their degradation has already proceeded to far; water and atmospheric stability need to comply with Safety / Sustainability, while the atmosphere is in a steady flow balance between the two states.
BLOCKCHAIN USE CASE: DEFI FOR FOOD
Apart from the (too) often claimed use case of Blockchain technology in supply chain management systems, the potential to provide transparency / traceability, a major future application field of Blockchain will be in the DeFi sector. While it’s probable that DLTs will be utilised in supply chains to increase efficiency and prevent waste (even though it’s not a foolproof process, as the data output will always be only as good as the input inserted, leaving room for human fallacy), Blockchain tech could potentially find even greater use in its application as a decentralised network / platform for product data destined towards re- and upcycling companies looking for data on material streams and product content. The main disadvantage of circular economy implementations in the past has been the problem of not having access to valid data on the status and type of content and the products to be processed overall.
In the case of food finance, the tokenisation of real-world assets has only just seen its humble beginnings by the creation of platforms tokenising real-estate investment projects swept the market throughout the last few years. As we are in desperate need of a regenerative shift of our Food Economy, the main flaw of our food system lies in the fact that the capital necessary to fulfil this transition is misallocated and centralised at financial institutions and institutional funds not willing to back smallholding food enterprises that will be the enablers of such a transition. P2P- networks that provide equity or debt-based investment funds to certified food investment projects of farmers, producers, distributors, logistic companies, and the like could be an extremely potent use case of Blockchain technology towards a change of our food system. As Blockchain is pseudonymous, it even allows the participation of the billions of people that are unbanked and / or unidentified legally. Smart contracts would enable payments on an „if / then“ basis, fed by IoT live data on the state of the farm, the humus content of the soil on a farm level, or its increasing climate resilience due to improved best practises.
In summary, we have merely begun to explore the real-world use of a technology that has „fertilised“ our minds since its launch in 2008. Allowing ourselves to be inspired by other economic segments and fields of research different to the food sector will be key in coming up with the possibilities to reset our system to a correct state, that is both lively and safe.
Vinzenz Hahl
Image Source: https://clearspider.net/blog/blockchain-technology-solution-food-industry/
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