De Beers Invests in Blockchain Technology to Advance Diamond Traceability
This diamond traceability platform is underpinned by blockchain technology, which allows for a highly secure digital register that creates a tamper-proof and permanent record of interactions, such as a diamond’s path through the value chain.
“Consumers expect to know more about their luxury goods, the route they have traveled, their authenticity, and whether they have been a force for good in the world,” said CEO Bruce Cleaver in a note on Monday. This is in response to the advocacy for accountability under the Kimberley Process for treaceability of diamonds so as to limit the impact of global demand for diamonds (and other minerals) and fueling of civil wars and other forms of violence in developing countries.
The Kimberley Process started when Southern African diamond-producing states met in Kimberley, South Africa, in May 2000, to discuss ways to stop the trade in “conflict diamonds” and ensure that diamond purchases were not financing violence by rebel movements and their allies seeking to undermine legitimate governments.
He added that commercial players in the industry expected a modernized trading environment where goods can be bought, sold and shipped with increased trust and decreased cost.
This chain maintains a record of the activities that have taken place, the order they occur in, who they occur between and what they involve.
“The system is able to verify activity on the chain without needing to reveal sensitive details to the wider community. As a result, participants can be confident that a transaction occurred, but are safe in the knowledge that the sensitive data remains between them and their counterparty,” he said.
Once established, the blockchain will operate as a shared platform, on top of which a range of solutions could be built.
“It can be thought of as akin to a smartphone and a range of apps – once the base blockchain technology is established, participants in the ecosystem can build applications for various uses, whether that’s as a trading platform, a financialassurance tool or consumer-facing solution,” he noted.
As the first traceability platform to span the entire diamond value chain, the solution aims to provide unprecedented levels of confidence and assurance for all stakeholders.
“In the months ahead, we will continue to work with leaders from across the industry and share our progress,” he said.