Blockchain for the DoD Supply Chain?

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Since blockchain first appeared in 2009 as the digital ledger for Bitcoin cryptocurrency transactions, it has steadily taken the online world by storm, in the process practically becoming a synonym for security. Even if a lot of people still don’t know what it is, they’re beginning to hear it more and more. IBM, for instance, has taken to mentioning “blockchain for security” in its TV ads. And in a sure sign of pending mainstream acceptance, a “Blockchain for Dummies” book is now available.

The Department of Defense (DoD) has taken notice, even if it hasn’t been on the forefront of blockchain acceptance. The National Defense Authorization Act for fiscal 2018, signed Tuesday by President Trump, includes a provision ordering DoD to conduct a comprehensive study of blockchain, particularly with regard to cybersecurity. Some DoD components, meanwhile, have been exploring blockchain on their own as a way, for example, to deliver secure messaging to deployed troops and for protecting the digital 3D printing supply chain for ships at sea or units in the field.

So why not use blockchain for the overall supply chain? The logistical supply chain, after all, is more than ships, freight cars, and trucks. It depends on online networks and communications, and as a result is vulnerable to digital attacks. The Office of the Director of National Intelligence says that U.S. supply chains are under constant, systematic assault from foreign entities and other adversaries who look to use the attacks to “penetrate sensitive research and development programs, steal intellectual property and personally identifiable information, insert malware into critical components, and mask foreign ownership, control, and/or influence of key providers of components and services.”

The Defense Acquisition University, noting that cyber warfare isn’t limited to purely digital assets, says that supply-chain attacks pose several challenges, “but first and foremost is that emerging problems can hide in a ‘sea of transactional data.’ Information on everything, from where the product was assembled to where its parts originated, offers opportunities for nefarious actors to hide their intent.”

Blockchain technology, with its decentralized, distributed approach to recording and updating transactions, is one way to ensure that elements in the supply chain are not altered, faked, or infected. Lockheed Martin, the largest U.S. defense contractor, is getting on board, contracting with Guardtime Federal to integrate blockchain into its supply chain risk management – in the process becoming the first defense contractor to adopt the technology.

Using Guardtime’s Black Lantern appliances and its distributed Guardtime Federal Core blockchain infrastructure, the companies are developing a concept they call Cyber Aware Systems Engineering with the aim of providing secure software development and supply chain risk management, Lockheed said.

While some have contended that blockchain technology isn’t yet mature enough to handle serious loads, other corporations are moving ahead with the technology. IBM, Walmart, and Tsinghua University are collaborating on using blockchain technology to secure food supply chains in China. Danish shipping company Maersk this year partnered with Microsoft and several other companies, including Guardtime, to test using blockchain for shipping insurance. “This is not vaporware or something we’re going to do,” Guardtime CEO Mike Gault told Fortune. “It’s something we’ve built and proven.”

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