Blood Diamonds: Blockchain application to combat corrupt industry
Wars in developing countries are often financed by the sale of controversial Blood Diamonds. Blockchain technology is now being applied by the diamond industry to better mark and track diamonds, enabling both buyers and sellers to identify the origins of their diamonds.
Background on Blood Diamonds
Blood diamonds, sometimes known as war diamonds, are mined primarily in African war zones and then sold to finance the ongoing conflicts. In the last two decades there has been growing awareness about the corrupt provenance of these diamonds. Businesses and consumers have tried to seek out conflict-free diamonds instead. This has lead to diamond merchants forging and counterfeiting documentation. This practice is to make the diamonds seem legitimate and it can be very difficult to tell the true origin of the diamonds. Blockchain technology is now, however, being used by the legitimate diamond industry to combat this practice.
How can blockchain help
A blockchain network stores information that is almost impossible to edit after it is applied. Unlike existing records, which are held on paper and easy to tamper with, this will make the records of each individual diamond almost impossible to fake. Great news for conscious buyers!
1.6m diamonds recorded on blockchain
Everledger, a London business founded in 2015, described as “the digital vault of the future”, has recorded 1.6m diamonds on blockchain. The records include many attributes of indvidual stones that will be matched on each diamond by laser inscription on one side. The information includes certificate number as well as color and carat, among others.
Founder and Chief Executive, Leanne Kemp said the blockchain ledger is a “digital twin” of the actual diamond. Everledger plan to be able to adapt this approach for wider use by retailers and consumers as soon as 2018. This could even enable buyers to check out provenance on your phone.
Additional to Everledges records, it is estimated that almost 2m diamonds have been recorded in this way.
If this approach proves successful for the diamond industry then many other industries may get on board and benefit from the technology too. The way global trade words and how products move around the world could also greatly benefit from using this system.