Trust, but verify: Potentials for zero-knowledge proofs in supply chain management

Sharing information is crucial for the success of most supply chains: transparency on inventories, production capacities, or shipping schedules enables better optimization of the end-to-end supply chain. However, many companies are hesitant to share data with their partners because the information might be turned against them: Suppliers or customers could exploit information in many ways. Trust in the partner is a key enabler for information sharing. But trust is often lacking and difficult to build. To overcome this challenge, we propose using zero-knowledge proofs (zkPs), a concept from cryptography. Here, data is processed before sharing so that useful information for the partner is conserved while critical details remain secret. To understand where zkPs can be applied in supply chain management, we conduct expert interviews to develop and evaluate different use cases. We categorize the use cases in different dimensions and relate them back to theory.

Thomas Twenhöven is a PhD Candidate at Kühne Logistics University under the supervision of Moritz Petersen and Kai Hoberg. Thomas' work at KLU is focused on Blockchain technology in Logistics and Supply Chain. In particular, he has worked on the BlinK, ChainLog and HANSEBLOC projects. Beyond Blockchain, Thomas also researches the applications of zero-knowledge proofs in supply chain management.