Chain Link: How Blockchain Technology Enables Circular Supply Chains

Welcome to the Industry 4.0 Club's fireside chat. The club's purpose is to engage the power of diverse worldwide talent to accelerate the global evolution to Industry 4.0. We accomplish this by hosting and supporting respectful, thoughtful and interdisciplinary open conversations, and creating quality content on wide-ranging Industry 4.0 topics to expand the reach of our community. My name is Mike Ungar, and I am the CEO of the Industry 4.0 Club. I have over 40 years of leadership and experience in manufacturing, most of that being with Michelin. I'm joined today by my co-host, Mike Yost, who's chairman of the club. Mike, would you please introduce yourself?

Sure, thank you, Mike. Thank you all for being here. As Mike said, my name is Mike Yost. I'm the volunteer chairman of the Industry 4.0 Club, one of the co-founders along with Mike. Been in industry for about 35 years, the last 15 or so on the nonprofit side. So really interested to have the conversation with Brett here today and share ideas and learn everything that we can. So thanks for having me.

Thanks, Mike. So today we have the pleasure of speaking with Brett Blaylock, who's founder and CEO of Infinifty. So, um, and he's going to be presenting at the Sustainable Manufacturing Expo in Anaheim, California on February 5th, 2025. The title of his presentation is Chainlink: How Blockchain Technology Enables the Circular Supply Chain. So Brett's the founder and CEO of Infinifty, a product lifecycle traceability company with customers across multiple industries including fashion, collectibles, art, and consumer packaged goods. Brett previously worked for Feather, a sustainable furniture company, and Goldman Sachs as a data analyst. Brett, welcome.

Thank you.

Good to be here.

Before—

Mike, before you jump in with your first question, I want to mention anybody who's listening to us live on LinkedIn, if you've got a question for Brett as we talk about the topic today, please feel free to put it into the comment box, and hopefully we'll get a chance to answer that during our time together. Mike?

Yeah, excellent. Thank you. Yeah, I wanted to sort of start at the top with the name of your company, Infiniti. Yeah, I thought it was a typo at first. So could you explain how to pronounce it and what went into choosing the name?

Yeah, for sure. Yeah, I think at the time when I designed it, I thought I was being clever or being cute with it. So we are a blockchain-based company, and one of the key drivers or the key, like, structure of our platform is using NFTs. And so I thought it would be cute by incorporating NFT into the word Infinity. And so that's how you got Infinite. So yeah.

Excellent. That is— I think that is clever. So I give you credit for that. I just got a little tongue-tied, so apologize.

Yeah. Sorry, what were you gonna say, Mike?

No, I was gonna say that I bet this question comes up most, most often when someone meets you, like, what?

Yeah, I do see a lot of people struggle, and then I do feel bad, you know, because you just see them like infinite, and then I'm like, you can go with Infinity, we'll just let you say Infinity. Yeah, not a big deal. So then I feel like I look bad, you know, for making them struggle like that. So I don't know, maybe we'll change the name in the future, uh, but we'll see. Right now it seems to work, I think, for now. So Excellent.

Yeah, it's quite memorable. So I think that, you know, you've accomplished something pretty, uh, important there for people to remember your, your company is. And of course, now that we know about NFT and the connection with blockchain, it, it makes a lot of sense.

Yeah.

And I appreciate that. Yeah. So how did you develop your, uh, passion for the circular supply chain? Um, did it start with maybe your, your passion for the environment, or Was it the interest in blockchain, or just help us understand how you got into this business?

Yeah, I would say I first got into it professionally while working at Feather. So Feather, as I mentioned, as you mentioned, was a furniture rental company. So you try to, I would say, almost sustainable in the sense like towards the end of Feather's reign, we were focused on componentizing the furniture. So that meant like if a leg on the furniture broke, we would just replace the leg rather than the full piece of furniture. which is different than other furniture or rental furniture companies. And so that was the first foray into it. But I would say even just like, you know, personally always felt like I was someone that was somewhat environmentally conscious. You know, I wouldn't try to buy a bunch of different things that I wouldn't use. I would try and use things, you know, to its completion, if you will. And so I think there was always sort of that element of, you know, just being conscious. I remember one of the big reasons why I got into Feather was, you know, just being a young person. moving around, it was great because it's like, great, I don't need to own a bunch of furniture that, you know, once it's, you know, I'm— I need to move, right? Like a lot of cases, especially when you're young, right? You're buying IKEA furniture. That stuff only lasts one move, right? And then after that, you gotta throw it away. So it just felt like it was just much better from like a personal standpoint, but as well as from an environmental standpoint of not just like buying this furniture and then trying to get rid of it when I no longer needed it. So I'd say that was sort of the first foray into it. Yeah.

I probably shouldn't tell you that I still have my furniture from college, but so how does the connection between that desire for, you know, sustainability and environmental stewardship, how's that tie with blockchain? Like, how did you, were you a technologist to begin with or how does the blockchain piece come into this?

Yeah, for sure. So while I was there, I was on the data and finance team. So I sat in both roles and so, you know, just sitting in that role and just watching us, like, one of the— I guess one of the main functions of my job was to track the products from our manufacturers in China all the way through into— for us, it was donating or, you know, reselling it. And so we— I approached it very much from the financial standpoint of what was the ROI on the furniture, you know. And so from that, that sort of traceability piece and just really thinking about, like, okay, circular economies and what have you, During the time I was getting into a lot of blockchain research at that time was 2021. So there was the height of the NFT market and everything. And so I was like, okay, this is really cool technology. How can it be applied for circular supply chains? There seems to be something here. I didn't think it was very useful for like Feather itself as an organization. I think blockchains are better used when you're trying to bring on multiple different parties rather than one party at the same, or, you know, rather than within an organization itself, just purely from the fact of like processing transactions and things like that. Any sort of information that you're trying to add or, you know, share within like an organization is gonna be much faster through like an ERP or some sort of proprietary cloud-based system than it would be through blockchain. So, you know, from there, just started thinking more about, okay, how would it work in sort of a broader aspect? And, you know, thinking about the circular economy and how circular economies are coordination across multiple different stakeholders rather than one individual company itself, because no one company can make a product circular, right? It's the coordination from manufacturers to the brands themselves that are designing the products, to the recyclers, to repair folks, and so on and so forth. So I think that, you know, kind of thinking about, you know, the time of Feather, circular economy tech that we were building, and how blockchain could play into it. And so that's sort of Kind of drove me down that path.

Gotcha.

Yeah.

Now, the— you mentioned Feather, uh, great, the example of Feather taking furniture, receiving furniture from China, uh, using it and then selling it or giving it to someone else to, to, to use. You know, in today's world, at least in my history, we had a hard enough time getting into the recycling business. And figuring out how to go zero landfill. How do you get to circular supply chain? I mean, that's a whole other leap, right? Where it doesn't just go into the landfill, it actually gets used again. And is there a place for that in a company like Feather, as you described, or that industry? Or is it still kind of the circular supply chain something just for a few industries? Can you help kind of think through that a little bit?

Yeah, for sure. Yeah, no, I think circular supply chains are open for any industry. You are seeing certain industries adopt this technology or this approach much more readily than other ones. The most notable one is the fashion industry. And I think, you know, furniture is somewhat tangential to that. But the reason for that, right, is that there's a lot of waste that's created every year by textile waste. I have a study, you know, from 2018 the EPA conducted that said 17 million tons of textile waste is generated every single year, and 85% of that ends up in landfills. So there's a huge problem, and that's why you're seeing regulation in the EU as well as here in California that is requiring companies to adopt more circular practices to help reduce the, you know, the textile waste that's generated every single year.

So you talked— you mentioned China off the bat. We've talked about the EU. You're in California. You're talking about different Different states, countries. So from a blockchain perspective, does that present a challenge working across those different geographical and political boundaries, or is it actually something that helps having that technology base to work on?

Yeah, for sure. Yeah, I don't think there's really too much of an issue from the technology side. It's really just the human element that always becomes the most tricky. Because the blockchain at the end of the day is like really just capturing the data and sharing it across the circular supply chain. So, you know, I think a good example of this is like, you know, I know you have a lot of manufacturers on the call, so the manufacturers are creating the products, they're going to know the material composition of the product. That material composition is important later down the road to a recycler, and so that they know, okay, great, this is made of XY materials, we know that the current rate for this material is X, so then we probably resell this in the open market, or this is, you know, somewhat valuable component that we should salvage and so forth. So I think really the blockchain just acts as a means for data sharing and collaboration for everyone rather than so much like, you know, I guess more of a political or anything like that.

So you mentioned already that you're— when you were tracking things and doing, looking out for the product and and tracking it from China and stuff. You were coming at it from the financial perspective.

Yep. Right?

And we've seen for many, many years that there's no driver like the financial driver. And so oftentimes any types of technology systems being deployed into a manufacturer, you know, doesn't have to be blockchain-level stuff, but you know, the driver is oftentimes financial.

Right.

And a lot of times the operations teams are trying to make the case that we're gonna improve operations and they just don't seem to have as much clout and sway as the financial piece. So do you see that the blockchain fits in any particular camp? Is it more financially driven or applicable? Or does it also get into the operations and warranty tracking and any number of other parts of the business?

Yeah, I think from just where the history of blockchain came from was from a financial perspective. So you're seeing a lot more use cases of blockchain for finance-related activities. Most like popular one or kind of more mainstream would be BlackRock recently put their treasury bills on-chain. And I know that's a technical jargon that I just threw out there, basically meaning that they're now deploying T-bills onto a public blockchain network. And so that information's all there. They're using it because it helps, one, provides more transparency, but banks have also found that it helps improve operations when it comes to settlements and things like that. So yeah, I think, you know, the industry right now, at least, you know, with folks I've talked to and see where investments occurring right now, it's definitely focused on the financial side. But I think over time, as there's other different, you know, themes that investors or just, you know, the industry itself is interested in around what is called RWAs or real-world assets, I think you'll start seeing that shift away from financial products into tangible products, which is, you know, what we're focused on to then use the tokenization to improve operations and supply chains. One of the things around is like reducing the amount of silos of data that occur within supply chains.

Oh yeah.

Everyone, right, has their own separate system that's storing this information. And so you can actually use, going back to that thing that I mentioned earlier around the blockchain acting as a central source of truth, it could then— you could basically what they call tokenization, which is really just creating digital twins for the physical inventory. You could use that as the means to track the products digitally as they move physically in the world. So as the inventory moves so does the digital twins, and that should remove a lot of data silos in hopes that supply chains can operate more efficiently.

Excellent.

Wow, that's really cool. Hey, we have a question from one of our listeners. I wanted to share it on the screen. Alan asks, how might blockchain integrate and/or address concerns from suppliers that are keen to keep their material composition proprietary?

Yeah, for sure. There's different security features that are up and coming right now. One of the most notable ones is zero-knowledge proofs. So this is a pretty complex, like, mathematical, you know, concept, but I think probably the easiest way to think about it is whenever you go to a bar, right, you share the ID to the bouncer and, right, for them to check if you're 21 or not, right? So they don't need to know all the different additional information about yourself, right? They don't need to know your address, your height, your weight, your eye color, or anything like that. They just need to know that you're over 21 and therefore can enter. And so that's the, that's what zero-knowledge proofs provides is that it allows companies to share a select amount of information up to what they need to know to perform their function. So to then translate that example into something for manufacturers, right? You know, a company may develop some sort of proprietary type of plastic or what have you, right? And they don't want that material composition to go out, right? Because then someone else could replicate it. But a recycler further down the road needs to know what sort of composition that product is so that they can recycle it effectively, right? So if it has some sort of percentage of this particular type of polymer, right, they're going to treat it differently than another percentage. And so that zero-knowledge proof can really just say, hey, this meets this threshold of this particular polymer, therefore you can, you know, divert it down this stream versus that stream. So yeah.

Just to, you know, I'm sorry for I'm a— my knowledge of, of a circular supply chain is, you know, it's fairly basic, so this may seem like a naive question, but when I think about circularity, I think about, uh, kind of a, a non— an unended or non-ended loop, right, that keeps going around and around. How far can we— how, how much history can we keep with blockchain? Can we, like, discover that this product was used, like, 2 or 3 times before now? Measure that kind of thing?

Yes, it's technically possible. Yeah, if the information sharing is there, it's technically possible. Yeah, so the— we can start, right? Like, you have— let's go with polyester because I know there's companies that can break polyester down and convert it into a raw pellet that can be used in textiles. So we'll just say that you have a— what's a virgin polyester? That fabric is created from a manufacturer, you know, persists throughout its life, you know, somebody wears it, maybe it's bought and sold or what have you, and finally it reaches its end of life. It goes to a sorting facility. They'll then, you know, use a digital twin that's linked to the blockchain through that NFT that we talked about previously. That digital twin will then share the material composition of the product to that recycler, and they'll say, okay, great, this is 100% polyester shirt. We can now divert it to this textile-to-textile recycler that will then break that polyester down, convert it into a raw pellet that then can be brought back into the ecosystem. in the manufacturing process as like a raw material. And so if you're working with all these different companies in that ecosystem, you can just transfer that information. Like they say, okay, great, we got this 100% polyester shirt from this facility. It then came into our facility, we then broke it down, and then now we're now releasing it as a pellet. And so you can create all those links. It's not, you know, going to be a 100% seamless process. There's definitely operational changes that need to occur to make sure all that tracking is managed. But yeah, it is technically possible to do that.

That's interesting. I mean, when you start thinking about this in terms of creating a real circular environment, it's pretty cool to think what could possibly be— what the future could look like, you know?

Yeah, yeah, because you're just really linking a lot of these different actors together and just creating that full audit log of everything that's happened.

And as long as you're able to maintain those records and transfer it to the next owner, So just, just the, the process of doing this, right, when you're talking about, you know, different parts of the supply chain touching product, tracking product, processing product, etc., etc., is the blockchain technology built into applications that allow you to, you know, track incoming and outbound materials, or is it a tech that you're building on top of? Yeah, so technology that everybody themselves has to program to connect the dots? Do you know what I'm asking? Does that make sense?

Yeah, so there is, um, it's similar to, I guess we'll use cloud because people are similar to cloud. Like you have what is both the front end and the back end. And so the back end, we'll say for blockchain, is actually storing transactions on the blockchain network. But you have what are called smart contracts. It's a bit of a misnomer. But a smart contract acts as like an application on the blockchain. And that I would say acts as your middleware. So that's what's conducting the business logic that's generating some sort of transaction that's ultimately stored on the blockchain. And then, right, you have some sort of front end like you do with any sort of cloud solution or web application, right, that you're engaging with that then when you push buttons or things, that's what triggers business logic within the application. In that same example, that's what triggers the business logic on the blockchain through that smart contract.

So yeah, if I'm the manufacturer, I'm likely worried about the smart templates or the application interface and such more so than core blockchain itself.

Right, yeah, so you're, yeah, you're going to be focused on the smart contract development and writing, but you know, that's why you would use a solution like ours is because, right, we have those smart contracts already written, vetted, and everything, so you just can onboard And we extract all that away. So it feels very much like a traditional Web2 type experience where you go into an application, you push a couple buttons and things happen on the backend. So all that is really extracted away.

So at the end of the day, you end up, you have the supporting infrastructure, the technology infrastructure underneath that is blockchain that's doing these magical things and that has the capabilities and security, traceability and all those sorts of things. But as a business owner, I care less about that and more so about the functionality that I'm getting out of it, the ability.

Right.

And do you see circular economy as being a big enough driver to have people do that? Because historically, I haven't seen that, that there's oftentimes consumer or worker perspectives. And I'm not saying manufacturers don't want to be good corporate stewards, because I know most of them do, but to invest in a A strategy like that oftentimes again comes back to the point of if we're not, you know, where's the money in doing that or improving our operations? And so do you see folks looking at it and say that the circular economy is a strong enough value proposition that they're going to look for these types of solutions?

Yeah, yeah. I mean, it's right now I would say more of a niche Audience right now. And these are companies that are, you know, sustainability is a part of their ethos and they want to prove that to their customers. So we're seeing a lot of interest from those brands and companies reaching out saying like, hey, okay, cool, you're creating this solution, great. You know, for us, right, like we want to show our customers that we're sourcing our products from ethical facilities as an example, or we want to track our environmental impact so that we can purchase offset credits, or we can show to our consumers like, hey, In order to get this particular product to you, we emitted X amount of CO2 to create it. And so for them, right, the hope is that as more brands do this, customers can then start assessing, okay, well, this shirt's roughly the same price, but it has a lower environmental impact. I'm going to purchase one there. Yeah. So yeah, it's not a broad industry thing just yet, but I think, you know, as the hope is, is right, like using technology like ours, we can help them reduce costs as we talked about from the supply chain side. And then there's other features in our platform that allow companies to also generate additional revenue as well. So the hope is that we can help make this solution either, you know, cheaper to manage and operate, that it has ancillary benefits to their business as a whole. So sort of like, yeah, circular economy is maybe a benefit as a result of adopting our technology because they get all these other benefits to help, you know, satisfy those finance folks on the team. Right.

Excellent.

Do you see more pull? You know, I know that in today's world, because of the economics of circular supply chain and recycling in particular, that a lot of times we see more pull for that because of regulation. Are you seeing pull for your product from Europe more likely than here? Or, I mean, one, are you international? And then 2, are you seeing that happen? Like I said, more out of other zones than the US or equally as much here?

For sure. Yeah. So the quick answer, we are chatting with folks internationally, chatting with folks in the UK and looking to service folks in Europe as well. But most of our customers are here domestically. And so, yeah, you're seeing legislation being a driver for interest. We've talked to some brands recently and they're very interested in how our solution can help them with California's SB 707 bill. So I can just do a quick overview on that one for those folks that may not be familiar. It's, it's targeted towards the textile industry, so if you're not in that industry, it's probably not relevant right now for you, but it is an extended Producer Responsibility Act. And so what that means is that textile producers will need to come together and basically contribute to what is called a PRO, or Producer Responsibility Organization, And that organization is responsible for managing the waste diversion, textiles for this one, away from landfills. So they're going to send it to some sort of facility to make sure, right, it gets categorized and processed, and then from there can hopefully go to a recycler we talked about, like those textile recyclers, and then diverted away. Or, you know, sometimes like with jeans and things, they can break that down and it becomes insulation, or it can be like foam inside like dog beds and things like like that. So there's other uses for that product and under the reuse category outside of just recycling. So yeah, I would say regulation right now is a strong driver, but there are also these brands too that are themselves, you know, just wanting to be sustainable. And so that's part of their ethos. So I would say a little bit of both.

Yeah.

Fantastic.

Yeah.

Yeah, I was just going to say again that we're live on LinkedIn. So if you have questions, go ahead and submit them here. And I guess, Brett, I wanted to come back. You know, you're going to be presenting at the Sustainable Manufacturing Expo in February in Anaheim. Just wondering, I mean, certainly we want to encourage people to come and attend your session. So what can folks expect to learn if they come to your session?

Yeah, for sure.

We'll do some quick overviews of blockchain technology. I'm not sure how many people are familiar with it. And then also we'll go over the circular supply chain as well. I know different people have different views on that, so we'll level set on both of those. technical terms, and then from there talk about like how the two work together and help facilitate circular economy for goods. Then we'll wrap it up with different case studies and examples so you can see how other companies are using this tech right now. So yeah, it'll be a good intro kind of 100-level course for everybody.

Fantastic. Yeah, so, so we're getting close to wrapping up for the day. Mike, do you have any final thoughts for the audience before we go to Brett and wrap up?

Just that, you know, the speed with which— well, both the speed with which technology comes at us and also the amount of time that things like this have been in flight, right?

Yeah.

So there's a lot that I'm sure Brett and people like Brett have learned for many, many years that are behind the scenes for many of us. But when I sit down and I have this conversation, I'm like, holy mackerel, where's this coming from, right? The speed at, You know, that this stuff comes at you. So it's really, I guess, hard to keep up with the pace of change, but it's also good to know that there are people around that have experience and expertise. And that's why we support these types of discussions and also the event itself. And so encourage people to jump in and learn more and talk with folks like yourself who know what they're talking about.

Yeah, for sure. Yeah, happy to answer any questions that people have. Feel free to swing by the presentation, happy to talk about how, you know, you can incorporate our tech into your solution or just, you know, help educate you on like where blockchain might be useful or where it won't be. And also where the circular economy, you know, should be considered because I think maybe as far as like some closing thoughts is like, there's also an element too of designing for circularity as well that will make like solutions like ours much more effective. I know this is also a driver from regulation too. That is one of the parts of the EU ESR. If folks are less familiar, right, it is over in Europe, but one of the key components of that legislation is, I guess, 3 things. So the first thing is what they define as eco-design, and so that's focused on developing products that are resource-efficient, energy-efficient, repairable, durable, and recyclable, all focused on this idea of like creating good quality products that last a long time and then can, you know, their life can be extended through their design decisions. And the next thing is around what is called a digital product passport. So that's capturing the information about the product, but also like its environmental impact and everything and where it's been, sharing that with different folks to help facilitate the circular economy for goods. And the last thing, which is probably less relevant for folks that are not in the textile industry, is reporting around unsold goods. What happens sometimes is goods that are unsold can be burned, and that's not great for the environment either.

So yeah. Well, fantastic, Brett. Thanks for that reflection as we kind of wrap up today. So really want to thank you for taking time out of your busy schedule to join us to give us a preview of your presentation at the Sustainable Manufacturing Expo, which is going to be happening. You know, Brett's going to be speaking on February 5th. The expo is going to be happening on the 4th and 5th at the Anaheim Convention Center in California. So we hope you decide to join Brett and the Industry 4.0 Club at the event. To register, here's the— Here's the website. And again, take a look at the other offerings as well and join us there. This is the first year of this event, and it'll prove to be— I think it's going to prove to be something that, not to sound coy, but that will be sustained for many years to come. Anyway, thanks again. So the Industry 4.0 Club would like to encourage you to take action to advance the deployment of Industry 4.0. That can be by reading an article, attending a workshop, developing a smart manufacturing roadmap, or challenging your organization to move forward. That's the same for sustainability. We'd like to know what your actions that you're taking and integrate that. When you do take an action, let us know. Go to our website at www.industry4oclub.com. Or to our LinkedIn page and drop us a note and let us know what you're doing. We host conversations like this routinely on LinkedIn and YouTube. And if you'd like to join us on a future broadcast, you can reach us also on our website or on our LinkedIn page and let us know you'd like to join us. So on behalf of Brett and Mike, thank you for joining us and have a great rest of the day and a great rest of the week. Thanks, guys. Thank you.

Excellent.

Thanks, everybody. Thank you.