De Beers diamond unit aim to launch the first industry-wide blockchain this year to track gems each time they are exchanged hands; starting from when the diamonds are dug out of the ground, De Beers chief executive confirmed on Tuesday.
The world’s leading diamond producers have put measures into place to verify the authenticity of the diamonds and to ensure they are not from conflict zones where the gems could be used for financial exploitation.
The gems being ethically sourced are pivotal in maintaining consumer confidence. It sells technology across the industry to aid in preventing synthetic stones as natural.
De Beers also works closed with the rest of the industry and governments to support the Kimberley Process set up in 2003 to increase transparency and eliminate trade in conflict diamonds.
Blockchain, the technology used for cryptocurrencies, complements its existing methods. It offers a safe way to track diamonds. It also provides a digital record of the diamonds.
“It’s a huge public ledger as immutable as anything invented,” CEO Bruce Cleaver told Reuters in reference to blockchain. “It’s a much more un-hackable system than anything on a single server.”
The diamond blockchain being implemented into the firm will be the first to span the entire value chain. It would be open to everyone in the industry and offers the potential to monitor each stone.
“It has the ability to be very significant for the industry,” Cleaver said in a telephone interview, adding it could reassure banks financing the industry and would make the mining supply chain more efficient and transparent.
Blockchain also has the potential to guarantee the ethical origin of other materials such as electronic vehicles.
De Beers began its pilot project this month after months of research. It was emploted due to the rising number of customers wanting guarantees diamonds had not been used to fund conflicts.
Cleaver adds that it is a bold step going public with the pilot, but they are hoping the entire industry will get on board.