This article was first published here
Hitachi and KDDI are testing out a blockchain based settlement system for retail coupons, combined with an existing biometric identification framework.
Under the trial project, Hitachi’s Hyperledger Fabric-based platform is integrated with KDDI’s current retail coupon infrastructure and a biometric verification system.
Staff members from the two companies are currently trialing the hybrid system at a donut shop in Tokyo as well a local KDDI store.
Participants in the experimental demonstration first get registered at the KDDI store, giving their biometric data and coupon credits. They then proceed to the donut shop, settling coupon transactions and validating purchases using only their fingerprints.
Merits over Traditional Biometrics
According to a press release from the tech conglomerate, Hitachi, this approach differs significantly from the traditional biometric verification process. The hybrid system encrypts users’ biometric data and makes it part of an authentication system based on a public key.
All relevant data is encrypted and securely stored on a blockchain. Retailers act as network nodes, scanning customer fingerprints to facilitate transaction settlement.
The company says that using this tamper-proof approach, it will be able to update the coupon balances of customers from all participating stores to the network simultaneously.
The theory of combining blockchain technology and biometric verification systems to form an unassailable identity authentication framework is by no means a new concept.
However, not everyone is in support of this seemingly unbreakable system. As early as 2016, security systems expert and blockchain veteran Andreas M. Antonopoulos said the following:
“By embedding into a blockchain, the irrevocability of biometrics is added to the immutability of a blockchain which makes dealing with compromised biometrics even more difficult.”
He went on to add that biometric registration might be
“used to enhance statistical analysis of activity, so that the leak of a single identifier can destroy all privacy.”