“Rakuten Blockchain Lab” to Accelerate Rakuten’s Blockchain Business

Rakuten Blockchain Labto Accelerate Rakuten’s Blockchain Business

Rakuten Blockchain Lab (RBL) was established in Belfast (UK) in August 2016 and currently has more than 20 members including members in Tokyo (Japan). We will share more information what RBL together with Rakuten businesses and partner companies are doing to create blockchain use cases.

Table of Contents

Promote the use of Blockchain with "Rakuten Blockchain Platform"

RBL is working on a mission to encourage experimentation and implementation of blockchain, cryptocurrency and distributed ledger technology. Our main activities are the development and operation of blockchain platform.

RBL is building the platform for enterprise that allow business units and engineers within Rakuten to utilize blockchain without having to worry about the technical complexities of implementation. Specifically, we provide a set of APIs that web engineers can easily use to try out the technology and implement actually into their applications.

Blockchain Meetup

The main role of RBL is to support business units within Rakuten to utilize blockchain easily and quickly. Therefore, when developing applications using blockchain, we jointly develop PoC (Proof of Concept) products and services on production with business units.

Also, because blockchain is a new technology, it is still not easy to gain a deeper understanding of blockchain and find suitable use cases. Furthermore, due to the characteristics of blockchain, cooperation with external companies is also important. Therefore, RBL is not only working on platform development, but also actively engaging in consultation, education, and promotion for both internally and externally.

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Production-ready solutions that support a variety of use cases

“Rakuten Blockchain Platform” supports both enterprise blockchain and public blockchain, and offers various production-ready solutions built on top of those blockchains.

Production-ready solutions

Regarding token, which is one of the main use cases of blockchain, it covers both digital token (fungible token) and non-fungible token. Digital token can be used for stablecoins, utility tokens, and micro-rewards, while non-fungible token can be used for digital collectibles, badges, and certificates.

It also offers a solution allowing to write free form events easily as tamper-proof record on blockchain. This solution can be used for sharing data and event among multiple companies in a supply chain, and for audit trail of event.

Rakuten Blockchain Lab

In addition, as a unique initiative to Rakuten, with the aim of contributing to the expansion of Rakuten Ecosystem, we are providing a layer of exchange between Rakuten’s assets and external assets as a blockchain-based solution. We actually started supporting the exchange of EU Rakuten Point.

In addition, RBL develops and operates hot wallet solution for the crypto asset exchange service "Rakuten Wallet", and is also focusing on managing private keys securely.

In platform development, we are storing cryptographic keys, and building, signing, publishing, monitoring transactions for various blockchains. Also, we are building the platform and various solutions in scalable and reusable structure.

For reference, the main technology stack (development environment) is as follows:

  1. Enterprise blockchain products such as MultiChain and public blockchains such as Bitcoin and Ethereum
  2. Node.js microservices and TypeScript
  3. Relational database technologies e.g. Postgres, Oracle
  4. Docker containers and Kubernetes container management
  5. Microsoft Azure Cloud

New value realized with blockchain

From here, we would like to introduce three projects carried out by RBL.

1. Secure occupancy management by linking with IoT Devices

First, we would like to introduce a PoC project for secure occupancy management using blockchain in collaboration with Wia, a Dublin-based IoT platform startup.

As various industries are affected by COVID-19 outbreak, businesses are required to operate according to new rules and show that they are operating safely according to regulations. In this project, data of the occupancy status acquired by IoT sensors installed in offices and other locations is recorded as audit trail on blockchain. Furthermore, based on the data, a system was built to take actions such as issuing a warning when the number of people exceeds the specified number.

The specific mechanism is that the IoT sensors installed in the RBL office first collects occupancy data and sends it to the Wia’s cloud-based IoT platform. The event triggers Wia's IoT platform to call the RBL platform and write the data on blockchain as tamper-proof record.

These events represent the current and maximum occupancy of the monitored space and are recorded as the occupancy changes. Authorized organizations can independently access the records through the blockchain nodes to get event details about the occupancy status.

In addition, the records cannot be rewritten even by administrators, so it can provide a higher level of reliability to stakeholders such as employees and auditors.

A PoC project for secure occupancy management using blockchain in collaboration with Wia

In this PoC, we have achieved development in a very short period of time by bringing together the core of solutions that both Wia and RBL have. RBL provides a solution "Auditable Event Service" to write events to blockchain.

In the future, it would be able to handle information from any IoT devices. We believe that this advanced IoT sensor can be used to build trust with customers and employees as a countermeasure against COVID-19. Furthermore, travel agencies, restaurants, and event reservation sites could utilize it to show data about the occupancy of the place which customers are visiting.

RBL wants to extend this PoC to other Rakuten Europe offices to meet internal compliance requirements when employees resume working in the offices.

2. New donation experience by improving traceability

Next up is the PoC project on donation traceability. In collaboration with Rakuten's Sustainability Department, we developed a product for a donation history management service using blockchain, and with the cooperation of an external charity (organization that donation campaign support), we carried out the donation campaign for Rakuten employees on "Rakuten Clutch Special Charity Fund" and raised a total of about 230,000 yen from more than 140 people.

There is a traceability issue at the flow of donation fund from donor's donation to charity and end recipients. For example, it is not easy for donors to know when and how donation fund is used, and charities do not have sufficient connections with donors. We conducted a PoC with the idea that the issues could be solved by gathering scattered information about donation events to blockchain that does not depend on a single company.

In this PoC, using the solution "Auditable Event Service", we recorded the donation history of the donor and the donation fund transfer history from the fundraiser (organizer of the donation campaign) to the charity on blockchain, and we visualized the entire donation process and all donation history with a user-friendly UI. In addition, using the solution "Rakuten Token Platform", we sent donors digital tokens to express appreciation from charity.

PoC project on donation traceability

In the future, it could be expanded to various use cases beyond traceability issues, for example simplifying tax deduction application for donation, instant payment of donation fund to charity, and utilization of token incentive to solve social issues.

3. Exchange service of EU Rakuten Point for Socios Fan Token

Lastly, we would like to introduce a service that allows customers to exchange EU Rakuten Point for Socios Fan Token, which was realized in collaboration with the fan engagement platform Socios.com. We aimed to establish a beneficial and sustainable partnership for both parties by leveraging both assets such as membership, fan base, loyalty points and fan tokens.

A service that allows customers to exchange EU Rakuten Point for Socios Fan Token

The role of RBL in this project is to provide a blockchain-based solution that supports the exchange of Rakuten Point for vouchers and coupons of partner companies. On "Club Rakuten", a service for Rakuten members in the EU, Rakuten members can get a voucher of Socios Fan Token in exchange for Rakuten Point.

This solution mainly supports exchange with the following three models, and this project adopts the first model.

  1. Exchange by preloaded vouchers
  2. If the partner company does not have an API that can be used for exchange on their voucher system, the exchange can be easily realized by uploading the voucher as a token on blockchain in advance through the API provided by RBL.

  3. Exchange by the voucher API of the partner company
  4. If the partner company has own voucher API that can be used for exchange on their voucher system, RBL will call the API when exchanging from Rakuten Point for more dynamic exchange.

  5. Exchange using RBL's voucher issuing system
  6. If the partner company does not have own voucher system, RBL's solution can be used to issue vouchers as tokens on blockchain that are exchangeable for Rakuten Point.
  7. Blockchain is also used to record the exchange rates and other important events in the exchange process such as information for billing.
  8. This project is positioned as a strategic initiative to improve the convenience of EU Rakuten members by increasing the liquidity of EU Rakuten Point, and we will continue to expand our exchange partners.

Make blockchain a key driver for business growth

The future roadmap for “Rakuten Blockchain Platform” will be considered primarily based on the demand from business units. For example, “Rakuten Token Platform” was developed to support a number of use cases including the exchange of EU Rakuten Point in 2020. Since the beginning of 2021, we have received strong interest in area of non-fungible token, so we are developing solutions to meet the needs.

We also believe that it is important to stay true to the basic principles of blockchain. As such, we are developing consortium-ready solutions used across Rakuten businesses and partner companies to support business growth.

Rakuten Blockchain Lab

Furthermore, we see expanding the blockchain community within Rakuten as one of our important missions. With the increasing adoption of cryptocurrency and digital token-based solutions in various areas, blockchain technology is rapidly getting closer to mainstream. In the circumstances, we believe that it is important to connect with not only Rakuten's technical team but also product managers and business leaders to encourage them to understand and explore the possibilities of blockchain utilization.

That's why RBL regularly holds internal training sessions to explain blockchain technology itself and the solutions which we are offering. We also conduct specific working group sessions to explore the possibilities for individual business domains.

We will keep active to increase the opportunities that blockchain is used as a key driver for growth of each Rakuten business and Rakuten Ecosystem.

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