From Teeka Tiwari, editor, The Palm Beach Letter: The deliberate sickening of 300,000 babies shocked the world…
The official tally “only” recorded six infant deaths. Unofficial estimates are much higher. We’ll never know how many of those children died.
In 2008, more than 20 Chinese dairy companies added melamine to baby formula. Melamine is a chemical used to make plastics…
Why did the Chinese manufactures contaminate their own products? For profit. Adding melamine to the formula would boost its apparent protein content.
Melamine causes kidney stones in children. The dairy farmers and corporate operators didn’t care. Ultimately, a foreign dairy company broke the story.
At the end of the day, a couple of low-level middlemen who supplied the melamine were executed… and a few executives were sent to jail.
Food safety in China is an ongoing problem…
In 2013, authorities seized 20,000 tons of rat meat passed off as mutton.
And in 2015, the Chinese government seized almost $500 million in rotted meat. Tests showed that some batches of the meat were 30 to 40 years old. That’s not a typo.
China’s food industry has been stunted by shady recordkeeping, bribery, and lack of transparency. Now, six years after the baby milk scandal went to trial, more than 80% of the formula sold in China comes from overseas. The domestic dairy market never recovered.
In short, China has a food credibility problem.
Two American corporate giants think they can solve China’s food safety issues… and make billions doing it.
Their solution may surprise you: They’re employing a technology that was once primarily used by sophisticated drug dealers and international money launderers.
The technology they’re turning to is the blockchain…
Until recently, the blockchain’s main use has been to secure the Bitcoin cryptocurrency. But corporate America is starting to co-opt this transformative technology for other uses.
[We’ve written more about how the blockchain works here.]
In November, I wrote about how Disney is planning to use blockchain software to boost profits from its parks. Now, Walmart and IBM are adopting the blockchain to improve food safety in China.
[The blockchain is a decentralized digital ledger. Its decentralized nature has made it uneconomical to “hack”… For example, it would require over $700 million in computing power to even attempt to hack the Bitcoin blockchain.]
(I go into a deeper dive on this in the November issue of Palm Beach Confidential. Subscribers can access the issue here.)
Because the technology is virtually impervious to hacking, any information on it can’t be tampered with.
That’s why Walmart is running a pilot program using blockchain software to track Chinese pork products throughout the supply chain.
Pork is the most consumed meat in China… but the Chinese are afraid to eat domestically produced pork because they don’t trust it. According to a Wharton study, pork imports in China have been growing by 150% annually since 2007.
Walmart will track and record farm origination details, factory and processing data, expiration dates, storage temperatures, and shipping details to ensure that pork products are safe.
By storing and monitoring every step of the pork supply chain on an unhackable database, there’s no place where shady producers can dodge detection.
If someone tries to game the system, the exact batch of bad pork can be traced all the way back to the responsible party.
That level of transparency and accountability has never existed before in China. Walmart might make billions off this new technology. If it can prove that it has the “cleanest” meat in China, imagine the competitive edge it will gain.
That’s just one way that massive corporations are remaking entire industries with blockchain technology. We are seeing similar strides in banking, trade finance, and securities settlement.
The easiest way to participate in this move to the blockchain is to own a piece of the oldest and most secure blockchain in the world… Bitcoin. Owning a little Bitcoin gives you a stake in the growth of this transformative technology.
Editor’s Note: There’s another blockchain that some people are calling Bitcoin 2.0. It’s already attracted backing from JPMorgan Chase and Microsoft. It’s quietly building entire trading platforms for banks and other financial institutions. Not many people know how to buy into Bitcoin 2.0. That’s why I wrote a special report on it. You can access it here.