Blockchain trialed for sea cucumber traceability in Japan

Published on
January 28, 2019

The blockchain (or distributed ledger) technology – originally created as part of the development of cryptocurrency – is increasingly being used as a tamper-proof record for traceability of seafood. 

Recently, an organization backed by Japan’s government announced it will be developing blockchain projects for food traceability, including a tracking tool and local tourism scrip for sea cucumber.

Japan is ahead of other countries in cryptocurrency trading, with 3.5 million active traders in 2017. Japan was the world’s largest Bitcoin trading market in 2017 at USD 97 billion (EUR 85.1 billion), and Bitcoin futures trading was even larger at USD 543 billion (EUR 476.2 billion). And Japan’s government continues to encourage the growth; While China and South Korea have banned initial currency offerings (ICOs) entirely, Japan is working on regulatory guidelines to approve ICOs.

As for using blockchain for food traceability in Japan, there are two embryonic ventures: One for tracking game meat (bear, boar, venison) from field to plate; and the other a combination of sea cucumber tracking tool and local tourism scrip. 

Japan has a problem with overpopulation of wild game, due to a reduction of hunting in Japan. Japan has strict gun control laws, such that each bullet fired must be reported and the empty shells returned in order to obtain new cartridges. In such a strict atmosphere, it is no wonder that few people take up hunting as a sport. Most hunters are aged and their numbers are dwindling. Sixty-six percent of the 198,000 licensed hunters in Japan are over 60 years old. The populations of wild boar and deer have boomed, resulting in boars damaging crops and deer stripping forest trees of bark.

In response, the Japan Gibier [Game Meat] Promotion Association, which which oversees the standards for the distribution of game meat in Japan, is creating a blockchain system to record the supply chain of Japanese wild game meat. The system, called Mijin, was developed by Tech Bureau and based on the NEM protocol. It will be the first instance of the Japanese government deploying the Mijin blockchain. A goal of the association is to encourage professional hunters by increasing demand for game meat. Increasing consumer confidence in its origin and safety is a vital step in this. Blockchain’s benefit is that it creates a tamperproof record that can be viewed by consumers or anyone along the supply chain with a smartphone by scanning a QR code.

In Miyazu, a seaside town famous for Amanohashidate, a pine-covered sandspit that spans the mouth of Miyazu Bay in the scenic, coastal region of northern Kyoto Prefecture, blockchain technology has also been floated for use in the seafood sector, combining traceability with a larger health and gourmet tourism concept. 

On 27 April, 2018, Naoki Ando, the executive director of the municipality of Miyazu, in Kyoto Prefecture, Japan gave a presentation titled “Future vision of Miyazu, where blockchain will meet sea cucumber” at the CERN Physics Meets Blockchain Workshop in Zurich, Switzerland.

Sea cucumbers (nameko in Japanese) are one of the local seafood products of Miyazu and are popular in a variety of dishes, such as nameko-don (sea cucumber rice bowl). The dried product is exported to China, where Japanese sea cucumber is considered to be of the highest quality, but there has been the problem of differentiating Miyazu sea cucumber from those produced in other areas. 

Because of this, a system that can verify the origin, and additionally contribute to local tourism, was needed, according to Ando.

The system being used in Miyazu was first implemented in Japan by ISID Open Innovation Lab (based in Tokyo), which applied blockchain to verify the quality of organic vegetables in Aya town, Miyazaki Prefecture. Seeing a press release, Ando contacted ISID to see if it could extend its technology to sea cucumbers. 

The main market of dried namako is China. Miyazu namako has been traded as “Kansai namako” and has been bought by Chinese buyers. But these traders use drying machines, while a traditional air-drying process has been maintained by the manufacturers in Miyazu. These manufacturers wish to protect the value of the local product by proving the authenticity of the whole process from the sea to the final product of dried namako.

With these features of the city in mind, Ando proposed a local tourism-use cryptocurrency, backed by the real value of dried namako. Tourists could use the currency in tourism-related businesses like spas, health treatments, and sightseeing spots. Chinese consider namako as good for health, so Ando believes a combination of health tourism and sightseeing is a marketable combination. The cryptocurrency would be called “Nama-Koin,” a play on word with namako. 

“Now we are arranging to be able to start Nama-Koin economy experiment in January 2019,” Ando said. “We intend to sell Nama-Koins related to the real sea cucumbers in our future experiment. Anyone can buy or sell Nama-Koin at the online market, and its owner can exchange it with each related sea cucumber. And if they want, they will be able to use it as a payment measure at Miyazu City.”

Although the value of Bitcoin and other cryptocurrencies has crashed, Ando said he does not fear that this will affect his project. 

“The value of Nama-Koin will be determined by the value of each related real sea cucumber. On the other hand, so-called crypto-currencies like Bitcoin have no endorsement with real value.,” he said. “Considering this condition, Nama-Koin must be different from recent crypto-currencies like Bitcoin. Therefore, we don't think Nama-Koin will be affected by the recent value decline of crypto-currencies.”

Contributing Editor reporting from Osaka, Japan

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