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When permissioned blockchain meets IoT oracles:
An on-chain quality assurance system for off-shore
modular construction manufacture
Lingming Kong

Chen Chen

Rui Zhao

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
u3009509@connect.hku.hk

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
jaden@hku.hk

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
Jeremyrui.zhao@connect.hku.hk

Zhe Chen

Liupengfei Wu

Zhongze Yang

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
cz77@connect.hku.hk

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
liupengfeiwu@connect.hku.hk

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
zoeyang@connect.hku.hk

Xiao Li

Weisheng Lu

Fan Xue

Dept. of Building and Real Estate
The Hong Kong Polytechnic University
Hong Kong, China
shell.li@polyu.edu.hk

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
wilsonlu@hku.hk

Dept. of Real Estate and Construction
The University of Hong Kong
Hong Kong, China
xuef@hku.hk

Abstract—Advanced information technologies such as the Internet of Things (IoT) and Modular Construction (MC) bring
new potentials to the construction industry. The trustworthiness
is critical for MC quality assurance (QA), particularly in the offshore manufacture stage. The emerging blockchain technology
which enables transparent, traceable, and immutable information
exchange in distributed systems opens a new avenue for managing
off-shore MC. However, the real-time data collection and update,
as well as permitted data access are two critical concerns in
utilizing blockchain for MC. The permissioned blockchain and
IoT is considered as feasible solutions. Thus, this paper presents
a three-tier architecture of permissioned blockchain with IoT
oracles: the infrastructure layer, platform layer, and service
layer. IoT devices in the infrastructure layer act as oracles
of the blockchain, feeding real-world data from MC components promptly on time through trusted APIs. A permissioned
blockchain network in the platform layer provides authentication
functions to ensure authorized access to QA-related channels.
A mobile-based application named e-InStar in the service layer
provides user-friendly UI for multi-stakeholders to access the
QA system named e-inspection 2.0. The three-tier architecture
design can thus respond to the data access and data updating
needs for MC QA, specifically for multi-stakeholders cooperation
requirements. An application case of a housing project validated
the permissioned blockchain in the e-Inspection 2.0 system in
This work presented in this paper was funded by the Hong Kong Innovation
and Technology Fund (No. ITP/029/20LP) and the Hong Kong Research Grant
Council (No. 17200221).

two aspects: (1) system transparency and security, and (2) users’
satisfaction with data collection and QA functions.
Index Terms—Permissioned Blockchain, Internet of Things,
Quality Assurance, Modular Construction, Oracle

I. I NTRODUCTION
Modular Construction (MC) is a trending distributed construction method [1], [2], in which most construction components are manufactured remotely in an off-site, sometimes offshore factory, and assembled into a 3D module before transporting by specialized vehicles to the construction site [3]. The
MC is deemed a promising solution for many countries that
have confined building space but urgent needs for construction,
such as Singapore and China.
Inefficient and ineffective execution of MC projects may
severely impact construction productivity in terms of cost,
quality, and timeliness. Quality in MC is associated closely
with safety and property [1], and the Quality Assurance
(QA) acts as a vital ‘gatekeeper’ to the MC project. It is a
systematic operation that ensures checking items in accordance
with the quality standards to meet a set of targets, such as
compliance, schedule, and function [4]. Therefore, QA is
a time-consuming task that must be completed during the
construction and pre-construction manufacturing phases [5].

[Citation]: Kong, L., Chen, C., Zhao, R., Chen, Z., Wu, L., Yang, Z., ... & Xue, F. (2022). When permissioned blockchain meets IoT oracles: An on-chain quality assurance
system for off-shore modular construction manufacture. 2022 IEEE 1st Global Emerging Technology Blockchain Forum: Blockchain & Beyond (iGETblockchain).
DOI: 10.1109/iGETblockchain56591.2022.10087164

The authorized individuals and parties, such as contractors,
supervisors, and developers, frequently perform the inspection
part [6]. Furthermore, the physical presence is indispensable
during inspections due to the MC’s nature of the distribution. Moreover, file-based QA remains the primary mode of
information recording, revising, and sharing [2]. As a result,
inspectors from different parties must record inspection data
on-site and subsequently enter the data at the office. However,
the lock-downs of COVID-19 undoubtedly makes traveling
and on-site working troublesome or even impossible.
The recent advancement in Information Technologies [7]
has brought potential opportunities for digital QA [8]. For example, Wu et al. [9] developed a method to facilitate efficient
QA by adopting Building Information Modeling (BIM) and
IoT on a mobile device. A collaborative system integrating
BIM and indoor positioning can eliminate errors and cursoriness in QA [10]. However, the lack of integrated data recording
and confidence in the authenticity have led to the incomplete
and inaccurate report of QA, hindering a trustworthiness and
efficient QA [5]. The existing approaches mentioned in the
literature are still limited by centralized governance from contractors, resulting in low inspection efficiency and stakeholder
collaboration [1], [11]. Furthermore, the process, results, and
responsible individuals sometimes are ambiguous; contractors,
as the project’s general data manager, can sneakily modify
records to exonerate them from unexpected quality issues,
leaving original or modification records untraceable and easily
tampered with [12].
Blockchain is a promising technology to realize decentralized storage that chronologically and securely records data [6],
[13], [14]. It has been adopted in several construction industrial
applications, such as smart contracts [15], collaborative detection [16], and logistics management [17]. However, public
blockchains have some serious problems, involving prone to
attacks, the latency of data transmission and updating, which
hurdle wider application in the construction industry [18]–[20].
A permissioned blockchain generally involves a federation of
organizations in which transactions are blocked together and
verified by authorized peers rather than anonymous miners.
With a granted access control, transactions with consensus can
be achieved in an attack-proof manner. The IoT technology has
been utilized in contributing to promise better strategies in construction practice. For example, the social reputation capital in
IoT was optimized using a blockchain-based group formation
strategy [21]. IoT oracles guarantee the “true provenanc” and
real-time updating of data are two issues for implementing
permissioned blockchain in construction industry [22].
This paper aims to introduce a permissioned blockchainenabled IoT system named e-Inspection 2.0 to offer an adaptable solution to achieve secure data access, as well as trusted
data provenance and updating for MC QA. Compared with
the traditional insufficient inspection and inflexible manners,
a transparent, secured, and traceable framework was designed
to streamline and digitalize the QA procedures, for facilitating
co-management by stakeholders. At last, a case study of
practical application is deployed to validate its performance.

II. T HE PERMISSIONED BLOCKCHAIN - BACKED I OT
PLATFORM

A typical MC project usually involves one or several manufacturing factories, due to the fragmented construction process
and distributed stakeholders, the data sources are discrete
and variable for QA. The e-Inspection 2.0 system aims to
collect mass production data of MC projects through IoT
oracles and support trustworthy decision-making by leveraging
a permissioned blockchain. The three-tier structure of the
system is shown in Fig. 1.

Fig. 1. The three-tier structure of e-Inspection 2.0 system

The infrastructure layer integrates IoT sensors and provides
web and application servers, networking resources, and data
storage physical plants. In this layer, the IoT sensors/devices
serve as oracles of the second-tier blockchain network to
collect real-world data from distributed MC processes. The
infrastructure layer enables blockchain and database to deploy
quickly, and data from different resources such as human
beings, IoT devices, and files of the MC project can be stored
and computed efficiently.
A permissioned blockchain is implemented in the platform
layer. An open-source permissioned distributed ledger platform Hyperledger Fabric and the J2EE data web services
running on server Resin are employed. This layer serves as
the middleware of e-Inspection 2.0 system that involves the
database management tools, backend services, and deployed
blockchain ledgers. In this layer, all components serve as
a bridge for the communication between users and data,
and a parallel data exchange system using Java Database
Connectivity and smart contracts is developed. The inspection
records of materials and production processes of modules, as
well as dynamic BIM models of the target MC project, are
processed as quality assurance contracts (QAC) to support
trustworthy consensus-based collaboration among stakeholders. The structure of the ledger is shown in Fig. 2.
The service layer provides a mobile-based application
named e-InStar. Users can make intelligent decisions based

Fig. 2. Ledger service model in the platform layer (Adapted from Li et al. 2021 [6])

on the process management and QA of the off-site manufacturing activities of MC projects. Typical QA stakeholders
involve manufacturers/contractors, registered structural engineers, building service inspectors, authorized people, and
clients. Different roles contain different authorities in the app,
and Fig. 3 illustrates the transaction flow, which is based on
the consensus mechanism.
In this architecture, As shown in Fig. 3, the transaction flow
consists of three phases: the proposal phase, the ordering and
packaging of transactions phase, and the validation/submission
phase. In the first phase, the client application with different authorities sends a transaction proposal to a subset of
peer nodes that will invoke a QAC to generate a proposed
ledger update and then approve the results. For example, the
main contractor delivers a production inspection report of
door/window installation through the app; this action invokes
a chain code to generate a transaction T1 and submits it to
qualified peers, then receives an endorsed transaction proposal
response. In the second phase, app clients submit transactions
T1 to the ordering node to create blocks of transactions that
will eventually be distributed to all peers of the QA channel. In
the last phase, peers connected with the ordering node validate
each transaction in block B2 independently, and the validated
transactions update the ledger’s state (add block B2 to ledger
L1).
To avoid malicious users and guarantee the exact access to
the QA channel, the certificate authority (CA) and membership
service provider (MSP) supported by Hyperledger is utilized.
A CA dispenses certificates to users through the key-pair
mechanism, and a MSP is a trusted authority to prove the
identity and grant specific privileges an actor has on a node or
channel. Thus, only the project-related organizations and their
colleagues with different authorities are able to transact on the
QA channel.
The IoT oracles, such as prefabricated MC components with
QR codes, can be captured and recorded through smartphones.
With the help of the developed application, users with different
roles and authorities can scan the QR code or NFC (Near Field

Communication) chips on the module to record and upload the
related data to the system. As Fig. 4 shows, stakeholders of
an MC project can update the inspection data everywhere, and
related peers in the permissioned blockchain QA channels are
able to monitor these data changes timely.
III. I MPLEMENTATION AND EVALUATION
A. A case study
An MC project of a new student residence at the University
of Hong Kong (HKU) was used to test the e-Inspection
2.0 system regarding remote quality assurance. The student
residence comprises two 17-floor tower buildings with 952
prefabricated modules, of which the QA includes 40 tasks to
conduct at the off-shore manufacturing factory. Traditionally,
the QA practices were achieved by sending a troop of inspectors from Hong Kong to Mainland China where the parts of
MC were manufactured. However, the COVID-19 pandemic
and the control measures, such as long-term border control and
strict quarantine policies, made the traditional QA practices
surprisingly tricky. The e-Inspection 2.0 is deployed as an
innovative way for remote and digital QA.
The primary stakeholders in this MC project include the
Real Estates Office of HKU (owner and clients in Hong Kong
SAR, China), Paul Y. engineering (main contractor in Hong
Kong SAR, China), and Yahgee Modular House (manufacturer
in Zhuhai, Guangdong, China). The 40 inspection tasks for
QA can be categorized into five types in accordance with
stakeholders:
• 40 items for the main contractor (Paul Y.),
• 12 items for RSE (Registered Structural Engineers),
• 7 items for AP (Authorized People),
• 5 items for BSI (Building Service Inspectors), and
• 17 items for CR (Client Representative).
Other users include the architect, structural engineer, and
building services consultant. All these stakeholders had corresponding rights to access the system, for example, the workers
from the main contractor or building services inspectors access
the system via a smartphone application, as shown in Fig. 4.

Fig. 3. Transaction flow of the presented e-Inspection 2.0 system

Fig. 4. The smartphone application interface of e-InStar (Adapted from Lu et al. 2022 [1])

In this project, Paul Y. monitored the quality of the prefabricated modules during production through photography
and then submitted these photo records to AP or RSE for
validation. Each submission of the inspection photo records
invokes a transaction (proposal) in the blockchain network,
as Fig. 5 shows. For roles with permissions such as AP or
RSE, the commitment results of inspection tasks are sent to
the inspector with an endorsed response in a limited time.
Otherwise, the endorsing process will be done automatically.
After all the inspection tasks are finished, users deliver the
inspection report to the blockchain server and publish it to all
peer nodes. In this way, stakeholders in the QA channel can
access the inspection record anywhere.

B. Evaluation
The presented e-Inspection 2.0 system was tested in the
study case with practice production data. At the time of
reporting, 421 (about 43 percent) modules were produced with
detailed inspection records in the study case. This section
describes two performance indicators, namely, the security and
transparency of the system and satisfaction reported by users.
a) System security and transparency: The e-Inspection
2.0 system utilizes permissioned blockchain that only stakeholders of the MC project could join the network, the membership service provider of Hyperledger Fabric is used in this
paper to certify the authorized peers. In this way, the system
provides a granted access control function and prevents the

Fig. 5. Example of the pilot-floor on-chain transactions visualization interfaces for owners and contractors

(a)

(b)

Fig. 6. Examples of modules as IoT oracles (a) With GPS + tremble + env. sensors + 4G outdoor; (b)With QR codes indoor

whole system suffers from some cybersecurity attacks, such
as the Sybil attack, which is a typical attack on the consensus
process as the participants are anonymous and can have several
identities. At the same time, the permissioned blockchain
keeps all the inspection records and data transparent and
immutable for a consortium of stakeholders of the MC quality
assurance.
b) User satisfactions: The major stakeholders give positive feedback on this e-Inspection 2.0 system on both data
collection and QA functions.
In terms of data collection, the size of inspection attachments such as photos and instruction files are 44 gigabytes
(GB) for a total of 13,055 transactions. As Fig. 6 shows, there
are total 975 smart MC components in the practice project that
serve as IoT oracles through QR code or NFC chips. By simply
scanning the QR code on the module, or communicating with
NFC chips on the e-InStar app, users can achieve real-time

and compatible data uploading. Thus smartphones acts as the
media between users/permissioned blockchain and IoT oracles,
the unique QR codes and NFC chips ensure the collection of
true-provenance data. In the e-Inspection 2.0, each inspection
photo record includes the original size and a thumbnail, where
the average size of photos in original size is 1 megabyte
(MB) and the average size of thumbnails is 20 kilobytes (KB).
To guarantee the efficiency of data storage in transactions,
only the thumbnails of inspection photos are stored as JSON
values in Base64 encoded forms. In this way, the size of each
transaction is about 50 KB which is reasonable for blockchain.
Meanwhile, as Fig. 5 shows, the brief summaries of inspection
records are also stored in MySQL indexing tables that enable
users to browse the transaction details efficiently.
The HKU Estates Office confirmed that they understand
the virtual process of transaction flow in the permissioned
blockchain and feel confident about the massive volume

of collected inspection data. The main contractor Paul Y.
claimed, “[the] e-InStar supports various functions such as
the inspection, progress monitoring, statistical analysis, and
streamlined verification processes. It is an empirical evidence
of blockchain rebuild trust in construction.”
IV. C ONCLUSION
Trustworthy remote quality assurance (QA) is an urgent
issue for modular construction (MC) involving distributed
manufacturing and construction activities. Especially the restricted border control due to the COVID-19 prevents crossborder activities such as on-site quality inspection. The recent
advancement of information technologies such as IoT and permissioned blockchain has brought potential opportunities for
digital QA. The permissioned blockchain provides a promising
pathway for upgrading the information security and trustworthiness of a consortium of stakeholders. IoT oracles guarantee
real-time data collection from the real world. So, a permissioned blockchain-backed IoT platform is presented in this
paper, aiming to facilitate the security of the blockchain system
and data collection efficiency. It is an empirical evidence of
the claim that blockchain rebuild trust in contruction industry.
The significant contributions of this study are summarized in
two aspects.
a) The e-Inspection 2.0 system: An integrated quality
assurance system is presented with two highlights. 1) The
presented e-Inspection 2.0 system utilizes IoT MC components
for real-time data collection from the MC project, which
serves as the oracle of the permissioned blockchain network
to ensure efficient and true-provenance data collection. The
system also provides a mobile-based application named eInStar that support QA functions for MC stakeholders. 2) A
permissioned blockchain network for MC quality assurance is
presented, which guarantees the privacy and authority of peers
in the network and prevents the whole system from suffering
cybersecurity attacks. In this way, the MC project stakeholders
can comply with regulations, have complete control of data,
and come to a consensus on the present data state of the ledger.
b) A practical case study: A practical MC project is
used as a case study to validate the feasibility of the proposed
system. The experiment’s performance illustrates the reliable
privacy and security of e-Inspection 2.0 system, and the users’
satisfaction with data collection and QA functions prove the
feasibility and efficiency of the whole system. In the future, the
e-Inspection 2.0 system could be improved in terms of latency
performance and smart contracts’ ability to process complex
transactions.
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