Red Flag Governance
FenixTrace's Red Flag system is a decentralized quality assurance mechanism for the supply chain. It allows authorized users (Red Flaggers) to report products with irregularities, creating immutable and publicly verifiable records on the IOTA blockchain.
What is the Red Flag System?
The Red Flag system is a decentralized governance mechanism designed to ensure the quality and integrity of products tracked on FenixTrace. Unlike traditional centralized systems, it relies on the IOTA blockchain to ensure reports are immutable, transparent, and verifiable by anyone.
When a Red Flagger identifies a product with irregularities, they create a report recorded on-chain via smart contract. The report includes problem description, irregularity type, and documentary evidence on IPFS. Once recorded, it is visible to everyone in the public scanner.
The fundamental principle is transparency: red flags cannot be deleted or modified, and anyone can independently verify the authenticity of every report by checking the blockchain.
Reporting Workflow
The reporting process follows a 6-phase flow, from identification to public visibility. Each phase creates verifiable on-chain records.
Irregularity Identification
An authorized Red Flagger identifies a product with potential irregularities during an inspection, audit, or external report. The irregularity may concern quality, authenticity, regulatory compliance, or any supply chain aspect.
Report Creation
The Red Flagger accesses the dashboard and creates a new report: selects the product from the scanner, specifies the category and description of the issue, and optionally attaches documentary evidence on IPFS. The report is prepared for wallet signing.
On-Chain Signing & Registration
The Red Flagger signs the transaction with their IOTA wallet. The smart contract records the flag on-chain with all metadata: flagged product, reason, timestamp, Red Flagger address, and IPFS hash of evidence. The flag becomes immutable and verifiable.
Flag Notarization
A second wallet signature notarizes the flag, creating an additional on-chain record certifying the integrity and authenticity of the report. Notarization is the cryptographic proof that the flag was created by an authorized Red Flagger.
Public Visibility
The red flag is immediately visible in the public scanner. The flagged product shows a red "RED FLAGGED" badge, a red border on the card, and in the detail page the complete notice with on-chain transaction link and attached evidence.
PDF Label with Flag
When a PDF label is generated for a flagged product, the Red Flag section is automatically included with the report reason and visual warning. Even printed documents reflect the alert status.
Roles & Permissions
The Red Flag system involves four main actors, each with specific permissions and responsibilities:
Super Admin
Has full control over Red Flag governance. Can appoint and revoke Red Flaggers, monitor all reports, and manage disputes. Access to the complete admin dashboard.
Permissions
Appoint new Red Flaggers
Revoke a Red Flagger's authorization
View all reports
Manage disputes and investigations
Red Flagger
User authorized by the Super Admin to create reports. Has a dedicated wallet and their actions are tracked on-chain. Operates only on products of authorized companies.
Permissions
Create reports on specific products
Attach documentary evidence via IPFS
Notarize flags on-chain
Access the scanner to identify products
Company (Flagged)
Receives a notification in their dashboard. Can view report details but cannot remove or modify the flag. Can contact support to dispute.
Permissions
View flags on own products
Read report details
Contact support for disputes
Public User
Any user, even without authentication, can verify product status in the scanner. Red flags are visible to everyone with complete transparency.
Permissions
View all flags in the public scanner
Verify evidence on-chain via explorer
Access data via public APIs
What Happens When a Product is Flagged
When a product is flagged, the change is immediately visible across all platform channels. In the public scanner, the product shows a red "RED FLAGGED" badge and the card has a red border. The detail page shows a complete notice with the report reason, on-chain transaction link, and attached evidence.
PDF labels generated for flagged products automatically include the Red Flag section. Public APIs return the flag status with all details. This ensures the information reaches all supply chain stakeholders.
Red Flag On-Chain Data
Hash of the flagged product transaction
Report reason (descriptive text)
Red Flagger wallet address
Flag creation date and time
IPFS hash of attached evidence
Notarization transaction hash
Key Points
Reports are classified with statuses and priorities managed by admins and delegates.
Advanced filters allow analysis by company, status, date, and responsible operator.
Every relevant change leaves a trail useful for internal and external audits.
Operational decisions can include evidence and notarized references.
Governance reduces response times and improves escalation quality.
The framework supports compliance, risk management, and operational continuity.
Frequently Asked Questions
Only users with the "Red Flagger" role, appointed by the Super Admin, can create reports. It is not possible to self-assign this role. The Super Admin evaluates the user's competence and reliability before appointing them. Each Red Flagger has a dedicated wallet registered on-chain.
No, red flags are immutable once recorded on-chain. Transparency cannot be compromised. However, a Super Admin can add a resolution note indicating that the issue has been resolved, without deleting the history of the original report.
Impartiality is guaranteed by three mechanisms: (1) Red Flaggers are appointed after a verification process, (2) every report is recorded on-chain with the Red Flagger's identity creating accountability, (3) the system is publicly verifiable by anyone.
The company whose product has been flagged can continue to operate normally. The flag concerns the individual product, not the entire company. If systematic irregularities are found, the Super Admin may decide to suspend or revoke the company's DID.
Verify Red Flags in the Scanner
Visit the public scanner to verify the status of any product. Red flags, evidence, and on-chain transaction links are accessible without authentication.