With $20 million in initial coin offering financing in its pocket, Eximchain Inc. today launched a blockchain-based global supply chain platform that companies of all sizes can use to validate their credibility for help in financing and finding new contracts.

Hatched out of the MIT Media Lab, the Singapore-based company is tackling one of the most promising applications of blockchain technology with a unique architecture that leverages public networks. Blockchain is considered an ideal mechanism for enabling companies to gain visibility into the path that goods and materials take as they progress through a supply chain because its secure and immutable nature permits them to see where goods came from, the components or ingredients they contain and who touched them, without the need for third-party agents.

Most supply chain applications use private blockchains to ensure predictable scalability and performance. Eximchain is breaking with that tradition by leveraging a fork of Quorum, an enterprise version of the open-source Ethereum public blockchain platform developed by JPMorgan Chase & Co. The company hopes that the use of a public blockchain will open its supply chain to companies of any size without subjecting them to an approval process.

“We want to enable buyers who don’t know who they’re trading with to have trusted relationships,” said co-founder and Chief Executive Hope Liu (pictured).

In particular, the company is targeting the 70 percent of small and medium-sized enterprises in emerging markets that lack access to credit, a shortfall that World Bank estimates adds up to $2.6 trillion a year. By using a blockchain to validate the integrity of their business, these small companies have a chance to find new business and to tap into lines of credit from bigger partners.

The problem with public blockchains is that they can be easily co-opted by participants who overwhelm the network through activities such as bitcoin mining and initial coin offerings. Public blockchains, Liu said, “are permissionless, so you can’t stop people from using them. People are competing for the resources, so every time there’s a big ICO your transaction may not be processed for two days,” a time lag that’s unacceptable for most businesses.

Eximchain is attacking by the problem by modifying the way the Ethereum protocol enables consensus and permissions. It uses a procedure called “quadratic voting” that enables participants in a collective decision-making process to not only vote but to express the intensity of their preferences by allocating their votes across a pool of available choices. “It’s a much more robust consensus mechanism” than a simple yes/no decision, Liu said.

By restricting the number of master nodes that can be added in a given time and applying quadratic voting to the choice, “it’s mathematically impossible for someone to take over the network,” she said. “We are building the first public blockchain that supplies the security and scalability that enterprises need.”

Eximchain’s mainnet will launch on Friday with 233 machines across 14 regions, and several big partners already signed up for proof-of-concept testing, the company said.

Photo: Eximchain