Blockchain Privacy in Supply Chains

Abstract

Abstract: Product traceability within supply chains is a critical concern that has gained increasing attention in recent years. One promising solution to this problem is the use of Public Blockchain (PBC) technology, which offers an immutable, transparent, and decentralized ledger for storing key information such as ownership transfers and distribution records. These blockchain-based systems significantly enhance traceability by ensuring that data, once recorded, cannot be altered. However, a key challenge arises from the fact that information stored on public blockchains is freely accessible to anyone, potentially exposing sensitive distribution data. In this paper, I introduce a novel method that preserves the privacy of distribution data while maintaining high traceability in supply chain systems leveraging PBC. The proposed method utilizes encryption to safeguard sensitive data and Zero-Knowledge Proofs (ZKPs) to allow supply chain participants to authenticate themselves without revealing private information, such as their blockchain addresses. The solution was implemented using Ethereum smart contracts and evaluated for its cost-effectiveness. The results show that the transaction fee per supply chain participant is capped at USD 2.6, demonstrating that the approach is practical for real-world deployment.