Blockchain initiative gathers momentum
THE introduction of a blockchain initiative for diamonds is gathering momentum globally, with key elements in the industry adopting the new tracking system.
Studies in 2016 by Antwerp World Diamond Centre (AWDC), concluded that a blockchain could increase transparency and confidence in the diamond industry and access to funding for producers.
This will benefit diamond producing nations such as Zimbabwe, Canada and Botswana and help the cutting and polishing industry through availability of capital. On successful conclusion of pilot projects, the new regime is expected to be adopted on a global scale.
Diamond watchdog Rapaport this week reported Alrosa is considering implementing blockchain or other technology ideas for its rough and polished stones to address challenges with conflict diamonds and undisclosed synthetics.
A spokesperson for the Russian company was quoted as saying a tracking system would solve several problems and challenges it faces at the moment such as conflict diamonds, as well as undisclosed synthetics.
Alrosa said a traceability system should track and provide information about the time and place of mining a rough diamond, information about manufacturers and all steps the stone went through before it hit the store shelves.
Alrosa is a group of diamond mining companies that has the leading role in the world diamond mining by volume.
Alrosa’s move comes a week after AWDC, a Belgian f irm, announced it was in discussions with leading diamond producer De Beers about a potential blockchain venture.
De Beers said it was investing in the system.
The De Beers Group of Companies specialises in diamond exploration, diamond mining, diamond retail, diamond trading and industrial diamond manufacturing sectors and operates in 35 countries with mining taking place in Botswana, Namibia, South Africa and Canada.
According to Rapaport, Alrosa is currently studying options related to the digital ledger and has taken the first steps toward tracking in the Russian market by providing a paper certificate containing a unique ID number that traces the origin of each stone manufactured in its polishing division.
The document, Rapaport said, includes information on where and when the company mined the rough stone.
“While t hat identification method is currently only available for sales of polished diamonds to Alrosa clients, the miner aims to extend it to an electronic platform that would allow consumers to access a stone’s information, including origin, cutting history and characteristics. The miner plans to begin this as a pilot project in the Russian market, the results of which will determine whether it will extend the project to other countries,” said Rapaport.