De Beers, the world’s biggest diamond producer by gem value, announced on 10th May that it had tracked 100 high-value diamonds from miner to retailer using blockchain, in the first effort of its kind to clear the supply chain of fakes and conflict or blood diamonds.
De Beers is piloting a scheme using blockchain to create a virtual ledger of diamond sales. In this case, 100 high-value diamonds were tracked through the cutting, polishing and manufacturing processes and the logistics involved, until they reached the final retailer.
The company’s Chief Executive Officer, Bruce Cleaver, hailed the development as a revolutionary breakthrough. Cleaver explained in a statement:
An immutable and secure digital trail was created for a selection of rough diamonds mined by De Beers as they moved from the mine to cutter and polisher, then through to a jeweler.
The company plans to roll out the platform before the end of the year.
Getting Rid of Blood Diamonds and Fakes
In the past, companies dealing in jewellery have been accused of funding crimes against humanity. The so-called blood diamonds or conflict diamonds (when revenue raised from mining and selling of the gems are used to finance war, terrorism or tyranny) have long plagued the industry. Similarly, as diamonds travel along the supply chain, they are mixed with fakes, which make it harder for uninformed buyers to verify their purchase is ethical. However, the new technology is aimed at ridding the market of this long-standing issue.
The technology allows De Beers to show transactions to all participants while keeping their identities, and the values, hidden. Buyers can then have confidence that the stones they are buying aren’t fakes or blood diamonds.
The blockchain-based program, called Tracr, tags every diamond stone with a unique Global Diamond ID which stores the diamond’s characteristics like carats, color and clarity. The company says that the information can prove the provenance as the stone moves from hand to hand, from rough to polished, using an online, blockchain-based platform.
Cleaver believes that the new technology will only only help in getting rid of fraudsters in the supply chain but also enhance customer confidence in the company.
The Tracr project team has demonstrated that it can successfully track a diamond through the value chain, providing asset-traceability assurance in a way that was not possible before,
The New York Times reports that the company is working with other five industry operatives on the development of the platform, which will be made available later in the year. The five corporations are; Diacore, Diarough, KGK Group, Rosy Blue NV and Venus Jewel.
Image Credit: Deposit Photos