Diamonds have been treasured and valued since the dawn of humanity. Through wars, revolutions and conquests – diamonds have travelled the globe and are deeply embedded as things of great value in the human psyche.
They are mined extensively in many countries across the world with complex and secretive supply chains often making it impossible to know where a diamond came from – until now.
Everledger, a company founded by Leanne Kemp in London, is changing that and much more. The company uses Blockchain and “a symphony of technologies” to not just trace a diamond but tell its life story – from mine to market.
Everledger has seen its own journey sparkle as a young business to one that has raised millions of dollars (USD 27 million series A and bridge rounds), added thousands of diamonds to its database and is now taking its technology to other commodities like lithium, cobalt, emeralds and even fine wine.
Leanne Kemp spoke to Making Mining Better from Sydney, Australia.
“There wasn’t such a thing as a platform of provenance and so we began and set upon a journey to bring transparency to some of the most opaque supply chains in the world, starting with diamonds,” Leanne explains.
She’s right. The supply chain of most commodities is pretty opaque, but diamonds are shrouded in the mist of secrecy, intrigue and long global journeys. They are mined, sorted, cut, polished, exchanged at bourses, bought by wholesalers before reaching retail outlets on the high street. Diamonds change hands through this complicated system but there is one problem.
“Whether it’s the gentleman’s handshake and the chit of paper with a promise to pay or the handshake with a diamond embedded in the palm of the hand, we haven’t really seen the marrying of object identity and the event-driven processes along the supply chain to digital technology,” Leanne explains.
That’s where blockchain comes in, along with many other technologies to create a ledger that maps the life story of the diamond.
A symphony of technologies
“The diamond industry is hundreds of years of old and has used incredible scientific endeavours including scanning technologies for many decades. That includes resonant ultrasound, light refraction, even sound waves as well as spectro reading. And it’s the combination of those technologies with blockchain as a ledger that helps to not just only capture the identity of that diamond but also the event handling – where it’s gone to, who’s handled it, under what conditions have those diamonds been cut and polished, and where geographically have they gone across the world,” says Leanne.
According to the Harvard Business Review (HBR), blockchain that is at the heart of bitcoin and other virtual currencies is, “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. The ledger itself can also be programmed to trigger transactions automatically.”
The HBR says, “The technology most likely to change the next decade of business is not the social web, big data, the cloud, robotics, or even artificial intelligence. It’s the blockchain, the technology behind digital currencies like Bitcoin.”
Why is such a technology necessary?
With diamonds that answer is simple. There are a lot of ethical concerns about diamonds flowing into the global supply chain from conflict regions. These so-called ‘blood diamonds’ are mined in unregulated, illegal and often dangerous conditions. In 2000, the Kimberley Process was formed to stop illegal diamonds from entering the industry. While some feel that the process has been a success, others argue it doesn’t go far enough. Smugglers and criminals often find ways to keep their illicit businesses running.
Everledger is trying to fill that gap. “Diamonds are unique by their very nature. We were able to capture the identity of that diamond through the digital fingerprinting of the stone linking that to the blockchain technology and tracking it from the source of the mine right the way through to the retail network. So that now, when a customer walks into a store and asks a very simple question, ‘where does it come from?’ we can show them exactly where it comes from. And not only where it comes from, the origin, but also the impact that it’s had on people and the planet as a part of its supply chain journey.”
While this is one aspect of the technology that addresses a challenge from 20-30 years ago, there’s one that looks into the future – the circular economy.
“As you see, headline announcements from Apple, with the release of their version 12 phone, that all of their rare earth metals and minerals have come from urban mining. They are no longer taking natural extractions from the earth and with a big electronics player like that, we are starting to see the use and the reuse of materials in entirely different ways which I’m very happy for,” says Leanne. She has authored thought leadership pieces that are running around this space because she says, “I don’t think we’ll talk about the circular economy in 2030 because it will just be the economy.”
To be ready for the circular economy, it will be crucial to know where the stuff in our phones, homes and cars came from.
And that’s why Leanne has her eyes set on other commodities and high-value items like emeralds, lithium, cobalt and fine wine. Can you think of any other items? Comment below.