Jewelry colossuses mastering blockchain to authenticate gemstones2018-11-06T15:37:45.000Z 2018-11-06T15:37:45.000Z The world-known jewelry and precious stones companies are actively integrating blockchain technology in order to confirm the authenticity of gem starting from the moment of getting them from kimberlite pipe to selling it on the icehouses shelf.
The world-known jewelry and precious stones companies are actively integrating blockchain technology in order to confirm the authenticity of gem starting from the moment of getting them from kimberlite pipe to selling it on the icehouse’s shelf.
The largest jewelry manufacturers in the world that dedicate huge efforts to affirm the originality of their precious products recently have integrated distributed ledger tech that allows reinforcement of the authenticity identification process and, consequently, increase delivery system security.
De Beers reported passing viable trials of state-of-the-art blockchain system “Tracr” that gives the possibility to verify the authenticity of diamonds and other gems from the moment of mining to jewelry store. Tracr is expected to be launched into routine operation by the end of this year.
In fact, De Beers, the jewelry production giant keeping more than 30 percent share of the world gems market has presented the concept of establishing pan-industrial distributed ledger system at the end of the previous year aimed to monitor the entire jewelry products trail. De Beers’ blockchain innovative solution offers several benefits including proving the originality of the products as well as certifying that the rocks are extracted from the legal areas and are not the subject of illegal trafficking.
Basically, De Beers was not the only company involved in the process of new blockchain gem tracker creation: besides it, five more jewelry colossuses participated in the development process including Diacor, KGK Group, Venus Jewel, Diarough and Rosy Blue NV.
The TrustChain Initiative
In April 2018 one more gem manufacturing union has released the test version of TrustChain Initiative that utilizes distributed ledger tech provided by IBM. This solution provides the clients with the possibility to ascertain the originality of the gem-containing products via internet website where they can follow the marked trail of the bracelet or earrings from kimberlite pipe to the retail chain.
Similar to De Beers’ Tracr, five jewelry companies have participated in creation of the Trust Chain Initiative comprising Leach Garner and Rio Tinto Diamonds (both firms are specialized in precious stones supplying), Asahi Refinery (gems and precious metals processing firm), Richline Group (jewelry products manufacturer) and Helzberg (jewelry seller in the USA). Besides, the Initiative implementation is assisted by UL, a global independent safety science company.
According to Richline Group’s CMO Mark Hanna, integration of the blockchain TrustChain Initiative is not only the way to enhance the gems authenticity tracking practices but also to improve the reputational value of the company in customers’ sight.
Yet, the advancement process of TrustChain’s algorithm to confirm the originality of supplied jewels is elongated, therefore, the techniques are expected to become more smooth and solid.
The experts also believe that despite the fact a jewelry verification blockchain system is a quite pricey stuff and its benefits are unquestioned, it will be better if more members join the coalition.
It is worth to mention that there are still some points at issue to be resolved. For example, the experts doubt about distributed ledger’s efficiency inaccurate tracking of various gems and jewelry products types. For example, within the same network, it might happen that five participants offer more five types of a bracelet made of pink gold which may arrive from different countries, so it is not known yet whether the system will be able to distinguish them based on small features like engraving or shape.
Besides Tracr and TrustChain, the attempt to launch blockchain verification services for jewelry industry was also made before: two years ago, British company Everledger Ltd. has launched a ledger, provided by IBM, to record and trace the gems through the way of the journey from the mine to the store.
The essence of Tracr operation
Each activity or step, recorded by the systems, is formed as a bar of data containing exclusive knowledge or properties of the jewelry product while it is moving via the delivery channel. Each bar should be confirmed by the ledger society before being included in the blockchain structure. Naturally, each piece of entered data increases the social scale and after all, bars are interconnected as a solid chain the finished virtual trace is created for the product.
During the process of jewels moving via the delivery channel, they are assigned with an individual identification number that is robotically generated by the system. This ID comprises all unique features of gems such as scientific name, color, number of carats, optical transmission capacity etc. by communicating with other enrolment systems driven by the society members. This approach enables the vendor to roll up all available data about the gem into a single unalterable and permanent footprint that proves its originality and accountability from a miner to a customer.
According to De Beer’s, the pilot launch has demonstrated Tracr’s solid potential in stable verification of gems journey by generating digital ledger-based guarantee of gem’s authenticity in a manner that was even impossible to imagine before. The vendor is not going to rest on its laurels and believes in soon merge of Tracr with other similar solutions or at least more members being involved in the process of system exploration and maintenance.
The essence of TrustChain operation
In much the same manner TrustChain system is ensuring blockchain authentication of the jewels, supplied by five society members, the delivery journey and possible external party slip-up. Such intense interaction is aimed to charge up confidence in the provenance and lawfulness of the supplied piece of jewelry by consolidating legal jewelry products manufacturers and suppliers into a single chain.
According to the Allied Market Research, the world distributed ledger tech market size amounted to more than 220 million dollars in 2016 and in five years it will run up to more than 5 billion dollars with the annual growth rate more than 50 percent.
Taking into the account the active dynamics of blockchain integration in delivery channels tracing, it is predicted to become immensely prospective segment for distributed ledger practices implementation along with FinTech.
According to the experts’ opinion, over the last year and a half blockchain technology has swiftly covered the distance between the stage of figuring out what the distributed ledger is to the stage where the vendors are proving its functionality in practice. Blockchain transfer to the implementation stage is confirmed by numerous customers’ requirements and their growing awareness of tech’s essentials.
Moreover, the experts agree that the distributed ledger tech is spreading all over the delivery chain verification segment being deployed in various logistics-related industries such as jewelry, food, construction materials, electronics and so on.
The advantage of blockchain tech is its flexibility: in case the company doesn’t want to share in-house data, it can integrate the private ledger-based system, so only the authorized staff will have the access to the information. In case of applying blockchain techniques in a specific industry where the products are rather similar among different suppliers, for example, jewelry, several firms can generate single chain where each of them is an equal society member authorized to manage the system.
In turn, utilizing cloud experiences, several parties with distinct roles can participate in the navigation of the same network, for instance, in such case the gems mining company along with a transportation company, a retailer, an independent jewelry originality proving service and thousands of clients can be interconnected in a completely secure way.