Smart Pack: parcels damage verification system on Cardano.

[GENERAL] Name and surname of main applicant

3ken.LLC

[GENERAL] Are you delivering this project as an individual or as an entity (whether formally incorporated or not)

Entity (Incorporated)

[GENERAL] Co proposers and Additional applicants

Samuel Claassens, Stephen Witty

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

7

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language.

No

[GENERAL] Summarize your solution to the problem (200-character limit including spaces)

A dApp that scans a package using the camera of a commercial phone and links it to a UTxO on-chain. The recipient does the same the two images are compared using an AI to establish if it was damaged

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

No

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.”

No dependencies

[GENERAL] Will your project’s output/s be fully open source?

No

[GENERAL] Please provide here more information on the open source status of your project outputs

The image scanning technology will remain close source for the project.

[METADATA] SDG rating

SDG Goals

9 - Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation

12 - Ensure sustainable consumption and production patterns

17 - Strengthen the means of implementation and revitalize the Global Partnership for Sustainable Development

SDG Subgoals

12.2 - By 2030, achieve the sustainable management and efficient use of natural resources

12.3 - By 2030, halve per capita global food waste at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses

12.4 - By 2020, achieve the environmentally sound management of chemicals and all wastes throughout their life cycle, in accordance with agreed international frameworks, and significantly reduce their release to air, water and soil in order to minimize their adverse impacts on human health and the environment

12.5 - By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse

12.6 - Encourage companies, especially large and transnational companies, to adopt sustainable practices and to integrate sustainability information into their reporting cycle

12.7 - Promote public procurement practices that are sustainable, in accordance with national policies and priorities

12.8 - By 2030, ensure that people everywhere have the relevant information and awareness for sustainable development and lifestyles in harmony with nature

17.11 - Significantly increase the exports of developing countries, in particular with a view to doubling the least developed countries’ share of global exports by 2020

17.13 - Enhance global macroeconomic stability, including through policy coordination and policy coherence

17.16 - Enhance the Global Partnership for Sustainable Development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources, to support the achievement of the Sustainable Development Goals in all countries, in particular developing countries

17.19 - By 2030, build on existing initiatives to develop measurements of progress on sustainable development that complement gross domestic product, and support statistical capacity-building in developing countries

17.6 - Enhance North-South, South-South and triangular regional and international cooperation on and access to science, technology and innovation and enhance knowledge-sharing on mutually agreed terms, including through improved coordination among existing mechanisms, in particular at the United Nations level, and through a global technology facilitation mechanism

17.9 - Enhance international support for implementing effective and targeted capacity-building in developing countries to support national plans to implement all the Sustainable Development Goals, including through North-South, South-South and triangular cooperation

9.3 - Increase the access of small-scale industrial and other enterprises, in particular in developing countries, to financial services, including affordable credit, and their integration into value chains and markets

9.4 - By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities

9.5 - Enhance scientific research, upgrade the technological capabilities of industrial sectors in all countries, in particular developing countries, including, by 2030, encouraging innovation and substantially increasing the number of research and development workers per 1 million people and public and private research and development spending

9.b - Support domestic technology development, research and innovation in developing countries, including by ensuring a conducive policy environment for, inter alia, industrial diversification and value addition to commodities

[SOLUTION] Please describe your proposed solution.

Private postal carriers have a monopoly on the shipping information of the items they handle. This results in an information asymmetry between the carrier and client when the package suffers damage during transit.

The figures for these damages in the U.S. are staggering:

Damaged products cost manufacturers approximately 1% to 2% of their total gross sales. This equates to an estimated $15 billion annually in lost revenue.

On average, one in ten e-commerce packages arrives damaged. Based on an annual volume of 8.6 billion packages shipped, that’s 860 million damaged parcels and re-shipments.

The cost ripples through the entire industry as insurance companies have to investigate the claims, replacement items have to be shipped, and people have to spend a lot of time pursuing their claims.

Our proposed solution is a dApp that scans a package using the camera of a commercial phone and links it to a UTxO on-chain. The recipient does the same, the two images are compared using an A.I. to establish if it was damaged.

The record on the ledger verifies how a package looked at the moment it was shipped compared to when it arrived. The trail helps with claims and also opens up shipping information to everyone.

Benefits

• Customers can determine if a package has been tampered with while en-route.
• SmartPack makes packing suggestions that will reduce the chance of damages
• SmartPack performs OCR address verification

Across all SmartPack customers the following is measured:

• Damage / tamper rate by transportation method
• On-time delivery rate
• Intra-carrier damage rates (FDX Dallas to Little Rock, versus Dallas to Memphis)
• This data is used to suggest the best carrier based on route and transit time

The main 3 gains are:

1. Transportation Carriers can verify shipment integrity en-route with SmartPack.
2. Carriers can perform sort by fingerprint when address labels are damaged.
3. SmartPack data can be leveraged in claim disputes.

SmartPack customer flow

1. The customer creates a package for shipping
2. One or more photographs of the shipment are created via a phone app
3. SmartPack creates a virtual fingerprint based on the photographs
4. SmartPack makes suggestions on better packaging and verifies addresses via OCR
5. Shipment is given to the carrier
6. Optionally carriers take advantage of SmartPack verification while in transit
7. Once delivered, the receiving customer takes photos of the package via the app
8. SmartPack certifies shipment integrity or identifies the likelihood of damage / tampering
9. Shipment fingerprints and significant shipment events are written to the blockchain throughout the SmartPack process and used for audit/claim purposes as needed

[IMPACT] Please define the positive impact your project will have on the wider Cardano community.

It will bring a new type of utility to the distributed ledger. The postal claims are a significant drag to the shipping industry and a problem that remains without a solution.

The dApp would also increase the demand and use of ADA. The trail between the packages would be created by a datum attached to a regular ADA transaction. The system would need ADA to operate.

Finally, the dApp will not increase state bloat. As there is no need to create native tokens to make it function.

[CAPABILITY & FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability? How do you intend to validate if your approach is feasible?

First, we have the technical capacity to deliver a prototype entirely in-house. Our team has Cardano developers, mobile developers, imaging and lidar experts, and supply chain managers. All the tech requirements for the first iteration we can create ourselves.

The initial step involves an image scan that creates a model of a package and then attaches the image reference to a Cardano UTxO and stores it on Arweave.

The test transaction on the preproduction network will be public. Anyone in the community will be able to see them working and verify the prototype works.

All the on-chain data will be enough to prove the prototype is working and that the dApp is working as intended. We'll share demos of the process by uploading videos on YouTube of how the technology is working.

[Project Milestones] What are the key milestones you need to achieve in order to complete your project successfully?

Develop a basic phone application for photograph capture (Android)

Transmit photos to a back-end server with a local database (AWS, SQL DB)

Capture relevant shipment metadata - carrier, date/time, etc

Explore SmartPack GUI and user process flow by creating mockups of the completed platform and test it with users.

Test different types of cameras, photograph methods, lidar integrations, and box tampering with censors. The tests help determine a prototype for a scanning device to use by small shipping companies.

Once enough shipment data has been collected, apply AI models to fingerprint the packages and look for damage.

Real shipments must be used to measure general packaging wear during transport. The team member will send boxes to each other first inside the USA and then to the international members. The data will be used to train the model.

Connect the phone app to the Cardano ledger and store proof references of the images using datums in ADA transactions. A node will track the UTxOs of the created transactions and the specific boxes.

The image themselves will be stored on Arweave while the hash of it is referenced in a datum.

The objective of the pilot is to test the complete process end-to-end before it goes into a commercial application. We would scan a package, create the reference on-chain, scan it back once delivered, compare both images with the analysis model, and determine if it was damaged.

The pilot will be among the members of the team. We would send packages to each other, the idea is to demonstrate the technology, not to advance into a commercial application.

[RESOURCES] Who is in the project team and what are their roles?

Eric den Boer is a visionary Blockchain, Web3, AI, and Metaverse Entrepreneur. His career began in IT revolution of the early 1990s in Sweden, leading to contributions within the digital broadcasting technology.

His leadership prowess is demonstrated through his past roles as CEO of Natural State Extracts, driving advancements in supercritical fluid extraction technology and CEO of Pandotec, a Blockchain software company.

With a solid background spanning over 20 years as a Scientific Research Technologist at College of Engineering Research Centers, Eric offers a wealth of knowledge and a strategic edge in technology.

As we step into the age of the Metaverse, Eric is inspired by the belief that blockchain has the key to a truthful internet. Member of the Cardano CoffeDAO.

Stephen Witty is a technology professional with experience in the field of system engineering and IT projects. Holding a Bachelor of Science in Computer Systems Engineering from the University of Arkansas, and an Associate of Applied Science in Automation & Systems Engineering, graduating with honors. He also holds certificates of Proficiency in Electronics Technology and Fanuc Robotics Handling Tool Operation and Programming.

Stephen’s experience is marked by a distinguished 26-year career at FedEx, in various roles, from development and IT system administration to Manager of Technology. At FedEx he was dedicated to leading an R&D team at FedEx Freight, focusing on innovative projects such as RFID shipment tracking, fleet telematics, and shipment dimensioning technology. Under his leadership, his team pushed the boundaries of real-time logistics technology and received a FedEx Five Star award for his RFID efforts. 

Stephen’s philosophy, influenced by FedEx founder Fred Smith’s perspective on the value of information, aligns with his commitment to innovation and the belief that understanding and improving the flow of information can significantly transform the logistics and supply-chain industry.

Ričardas Darkšas As a dedicated programmer, my journey began immediately after graduation, diving into software development. My early work involved creating specialized certification software for a recruitment firm and developing order generation software for manufacturers, thereby enhancing supplier interactions.

My experience expanded to include working on an HR management system and a 3D gaming cafeteria management system. Additionally, I contributed to industrial projects, focusing on manufacturing process control, packaging, and labeling.

For an intense 2.5 years, I remotely engaged with a marketing company in the USA, enhancing my web development skills by working on various marketing campaigns. This role included traveling to Las Vegas twice to assist with the technical operations at live events. Following this experience, I made significant contributions to a document management system and various projects utilizing Java.

My most recent venture includes completing courses in blockchain technology, leading to my membership in a decentralized organization. Here, I work as a blockchain developer, focusing mainly on the Cardano network. Member of the Cardano CoffeDAO.

Samuel Claassens has over 15 years experience in software engineering, consulting, and taking novel systems to market. He has a diverse background, from founding small robotics startups to building enterprise ML systems at Fortune 500 companies such as General Electric. Sam is passionate about helping innovative startups that focus on software, robotics, AI/ML, and automation products or services. He has an MBA from the University of Chicago, and a Masters in Engineering from University of Johannesburg.

Sebastian Pereira is a graduate of Economics and Public Administration working first in the public sector. In 2019, he switched to the blockchain industry full time and has worked for many projects. He is also a blockchain instructor at EMURGO Academy, member of NFT-DAO. and CoffeeDAO. In the latter, he help to successfully tokenize a crop of Honduran coffee and sell it over the Cardano network. Member of the Cardano CoffeDAO.

[BUDGET & COSTS] Please provide a cost breakdown of the proposed work and resources.

Testing Parts Budget

Item / Part Individual Cost / Number / Total Cost / Notes

Rasberry Pi kits | 382 | 4 | 1528 | Pi 4 8GB kit - Power Supply etc

Various MCUs | 200 | 10 | 2000 | Based on Audrino MKR1400

Pi Motor Hat | 63 | 2 | 126 | Stepper Motor HAT for Raspberry Pi

Proximity Sensor | 21 | 5 | 105 | Trigger sensor for testing

Light Sensor | 17 | 5 | 85 | Package open detection

Desktop PC | 2150 | 1 | 2150 | General data collection device

MCU / Pi camera | 52 | 5 | 260 | Onboard ISP sensor for advanced camera controls.

NanoTags | 60 | 50 | 3000 | temperature tag

RAK2270 | 33 | 50 | 1650 | tracking tags

MCU Accelerometer | 21 | 10 | 2100 | Test drop detection

Mounts / Racks HW | 2388 | 1 | 2388 | Misc rack mounting gear

Variable Power Supply |131 | 2 | 262 | power source

Stepper Motor | 33 | 10 | 330 | Rotate shipments in a test environment

Battery Packs | 48 | 10 | 480 | Support mobile MCU tests

Shipping Supplies | 444 | 1 | 444 | Boxes and Packaging for testing

Apple Air tags | 70 | 10 | 700 | Support general package tracking

OAK-D S2 lidar camera | 598 | 4 | 2392 | Lidar scanner for the box 

Total ADA 20,000

AI and blockchain costs related needs:

Use of training models 10,000 ADA

Image processing on servers 15,000 ADA

Mobile application development 10,000 ADA

Cardano node server costs for 2 months 15,000

Image database storage 10,000 ADA

Arweave integration !0,000 ADA

Total 70,000 ADA

[VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

The dApp will showcase a new type of utility for the Cardano blockchain and the UTxO model. The system would also bolster the demand for ADA as users would require it to create the record on-chain.

It would also create another driver for adoption. Shipping companies, insurance companies, regular users, online retailers, etc. would greatly benefit from using the platform.

It would reduce the costs of making claims due to damages during transport, optimize the delivery of replacements, and reduce processing costs for all parties.

This would bring more users to Cardano and showcase the utility of distributed ledgers in an industry few are trying to integrate with blockchain.

[IMPORTANT NOTE] The Applicant agrees to Fund Rules and also that data in the submission form and other data provided by the project team during the course of the project will be publicly available.

I Accept