NFC and Blockchain

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NFC Tags and Blockchain ; Image : arrow/123rf

Blockchain technology needs little introduction. Bitcoin and other cryptocurrencies have powered the technology into the headlines in a way that very few other technologies have ever seen. It’s been hailed as the one of the biggest technology ‘game-changers’ ever and the bringer of a new age of currency and ledger security.

NFC hasn’t had quite that fanfare. It’s fair to say that progress other than contactless payments hasn’t been all that great. Part of the reason for this is often that the tech has had alternatives either with BLE, QR codes or plain old RFID tech. Another big part is also that it’s taken a long time for all mobile phone manufacturers to adopt the tech. However, NFC.Today have long believed that authentication is the trump card in the NFC tag pack. It’s something that sets NFC tag technology aside from many other technologies and can create the breakthrough that it deserves and needs.

Clearly then, a combination of NFC and blockchain could be a winning solution. A technology that’s available in the smart phones of millions and the ability to connect physical objects instantly to an open and secure virtual database. NFC could enable secure document, product, object or even person identification quickly and easily.

It’s also great PR for NFC. Thinfilm recently launched a Etherium blockchain powered add-on to the CNECT platform. A great way to push the technology forward from a forward thinking NFC company.

Now, regular readers will know that NFC.Today is very keen on NFC. The clue’s in the name. However, we are also realists and know that ultimately technology has to solve a problem to succeed. The question is whether blockchain is a good fit for NFC.

What is blockchain ?

This isn’t the place to try and describe how blockchain works in detail but we’ll try and cover the basics. There’s plenty of articles on the internet for those that like a little light reading. A blockchain consists of chunks of information stored in ‘blocks’. Each block contains the current information and a secure bit of data linking it to the previous block. And so on. In this way, each block can be traced back in a chain and you know that you are looking at a valid block. Simple.

Now, one of the key benefits of a blockchain is that it can be decentralized. This means that a copy of the data – the chain – can be shared across any number of computers which are called ‘nodes’. This has a number of advantages such that it’s difficult to change the data because a hacker would have to change data on more than one node. It also improves data access and availability because there’s more than one data store.

To create this decentralization, there’s also the concept that this open distributed blockchain is open and permissionless. Anyone can copy the entire chain and the logic is that in doing so, it’s also protected because arguably there’s nothing to protect.

This leads to an important concept with blockchain systems which is one of trust. In a financial environment, blockchain eliminates the need for a bank to get involved if money is transferred electronically from person A to person B. The trust that person A has the money to give to person B can be established by person B by checking the open blockchain system. In doing so, person B requires no reliance on the third party.

Where does the NFC tag fit in ?

In a nutshell, an NFC tag would then become the link between a physical object and the digital blockchain. This would allow a complex chain of information such as a supply chain history, which cannot be modified to be associated with a physical object.

Let’s explore this in more detail.

Tag authentication

One of the problems with the whole system is the issue of tag authentication itself. While the data in blockchain may be secure, the link to it from the NFC tag may not be.

This isn’t anything new with NFC tags and there’s been plenty of discussion on NFC authentication and issues around it. However, it makes the idea of associating and NFC tag with blockchain complex. In short, what’s the point of having reliable data behind the tag if there’s no guarantee that the tag itself is genuine. How does the user know that the tag¬† hasn’t been moved, links to the correct blockchain, not a copy of another tag, etc, etc.

The solution here is to use one of the new generation of NFC authentication (or even tamper evident) tags. However, now we’ve just layered one security tech onto another. The latest generation of authentication tags typically work using a private key which would could not be made public. Therefore, the private key would be required to be stored on a private server which would authenticate the tag before the tag link to the public blockchain system could be used. In short, we’ve just layered a completely closed private authentication system on top of the public, open system to allow it to work.

Ethereum contracts

One of the advantages of a blockchain system such as Ethereum is a concept of smart contracts. A smart contract,which would be written in code, allows an event to occur based on a series of other events – without user involvement. This isn’t that clever of course in regular programming but the difference is that once this contract is committed to the blockchain, it can’t be modified.

For example, some of the latest NFC tags can monitor temperature points. Assume that on each scan the blockchain is updated with the latest temperature reading. A contract could be written which would state that any reading below a certain level or a gap of certain time would invalidate the tag. The key point here is that both the logic of the contract and the data entered is not stored on a private system. It’s stored in public, on a large number of nodes and cannot be modified or changed.

Private vs. Public

As explained badly above, one of the main benefits of blockchain tech is it’s openness and decentralized nature. No data is stored in a single location and all data is shared.

For cryptocurrency this makes sense. A bitcoin is worth a bitcoin. Nobody is going to gain much by knowing that a bitcoin is worth a bitcoin. On the other hand, sensitive manufacturing details might be something that is best not shared. Essentially, how much data would anyone, for example in a supply chain, want to share openly.

So there are two options. The first is to encrypt some of the data that is stored within the blockchain which presents complex key management issues.

The second is that some of the data is removed from the blockchain and stored separately, you are now running two different processes and databases with the risks involved in that. Which means that a decision has to be made to store everything regarding that item in the blockchain or not. And if not, then what’s the true benefit ? Not all the information is secured by the blockchain and therefore what information can be relied upon.

The alternative here is a private blockchain. This is a blockchain that works within a permissive environment such that only certain nodes can create copies of the chain. However, careful consideration here needs to be made on the size of the network, the computing power required to maintain it and the technical skills required to control it. It could be argued – and it would be NFC.Today’s position – that a¬†private or in-house blockchain loses all the decentralization and openness and ultimately becomes only a complicated way of running a standard database. More importantly, the skills required may ultimately mean that it ends up being less secure, reliable or immutable as well. And almost certainly more expensive.

Can blockchain work with NFC ?

The short answer is of course, yes. Whether blockchain actually provides a better solution to other methods, NFC.Today isn’t sure. Our concern is that if the first stage – the authenticity of the tag – isn’t secure, then the rest seems a little meaningless. If the first stage of authenticating the tag is not based around blockchain, then surely a lot of the benefit of using blockchain is lost.

 

Blockchain is a virtual system designed to run in a virtual way and NFC tags are physical items used to identify physical objects. Authentication and supply chain management is going to be one of the key growth areas with NFC tags. The new generation of authentication, logging and tamper detection tags combined with mobile phone usage has enormous potential.

It’s quite likely that regardless of the pros and cons, blockchain and NFC are likely to be regular partners. However, in the opinion of NFC.Today, it’s not perhaps the best way to roll out an NFC based authentication/identification system.