A New Era for Handicrafts: Transparency and Trust with Blockchain
When we think of blockchain, most of us may think of cryptocurrencies, investment instruments or complex systems full of technical details. But what if this technology can enable transparent monitoring of handcrafted products, protect the labor of the producer and enable consumers to shop with confidence? This is exactly the question we have started a pilot project to address.
In this article, we will explain why we chose blockchain, which infrastructures we examined, the potential use cases in the handicraft sector, and why we finally chose a “fully decentralized” system.
The value of handcrafted products comes from their stories. However, in an environment where these stories remain invisible, the identity of the producer is unknown, and counterfeit products take over the market, the authenticity of handicrafts is threatened. At this point, blockchain technology emerges as a game-changing tool for handicrafts.
What is Blockchain and why is it important?
Blockchain is a digital ledger where information is sorted into unalterable blocks and linked together with a timestamp. Everyone in this system accesses the same data. It is immutable, indelible and transparent. In other words:
Who produced what?
When and how was it produced?
What stages did the product go through?
It gives clear and reliable answers to all these questions. This gives trust to artisans and transparency to customers.
What does this mean for artisans?
Every product has its own verifiable history in the digital environment. When a customer buys a bracelet, they can see who really made it. This gives the maker credibility and increases the value of the product.
Which Platforms are Suitable?
Throughout the project, we analyzed six blockchain infrastructures in detail: Bitcoin, Ethereum, Arbitrum, Optimism, Solana and Concordium. Each has its advantages and limitations.
To summarize briefly:
Bitcoin is the ancestor of blockchain technology and a reliable means of transferring digital value. But it consumes a lot of energy and is not sufficient for complex applications.
Ethereum is much more flexible. It offers a strong infrastructure with smart contract support, a large developer community and widespread adoption. But transaction fees are volatile and additional solutions are needed for regulatory compliance.
Arbitrum and Optimism are Layer 2 solutions built on top of Ethereum, enabling faster and cheaper transactions. They're great for large-scale applications, but for a first-step project like ours, they're not very different from Ethereum.
Solana is technically quite fast and has low transaction fees. But its governance structure is more centralized and reputation sensitive due to fraud cases.
Concordium is a highly compliant system that requires protocol-level identification. It's perfect for industries that demand transparency and control. But this ID requirement can create some friction in the user experience.
What about Architecture? Which structure is the best fit?
Technology is important, but user experience is just as critical. That's why we discussed four architecture options:
Fully decentralized system - everyone has their own crypto wallet, transactions are made directly by users.
Semi-decentralized (partial sponsorship) - users have wallets, but administrators pay the fees.
Account abstraction model - user wallets are created automatically, transactions are done through methods such as email confirmation.
Fully centralized solution - the system administrator does all the processing, the user is not even aware of it.
The first three options offer more decentralization and user involvement, while the last option is easier to implement but provides little data for the technology exam.
The project evaluated different architectural approaches. In some systems, operations can be done through a central administrator account, while others fully centralize the user.
The preferred model for this project: Fully Decentralized Structure.
This means that all users log into the system with their own crypto wallets and conduct transactions themselves. This approach allows users to be fully integrated into the system and allows the full potential of the technology to be tested. There are challenges, of course: Such as the use of crypto wallets and basic digital literacy. However, in the long run, this approach was considered the strongest ground to build a scalable and sustainable system.
