Resolving Inefficiencies in Supply Chain of Diamonds with Blockchain
Over a hundred years back, supply chain was moderately basic since the business was local, yet they have become unbelievably intricate now. It is extremely irksome for clients or purchasers to really know the estimation of items especially high-valued items in light of the fact that there is a noteworthy absence of straightforwardness in our present framework. Similarly, it is hard up to a certain measure to investigate supply chains when there is a doubt of unlawful or deceptive practices. They can likewise be profoundly wasteful in the process where merchants and providers attempt to solve the puzzle of who needs what, when and how. For example, a variety of diamonds known as “Blood-diamonds” which are just convincingly beautiful but are fake.
The true question is- Whether the customer is buying an authentic and conflict-free gem?
To address the supply chain inefficiencies like mis-shipments, lack of transparency between consumers and producers, inventory count errors, and middleman markup, many companies are changing the manual process of tracking through papers which are regulated by the government (central authority) to a more decentralized and automated solution involving minimal human interaction. For example, companies many-a-times rely on manual data records and paper certifications to adhere to the customs process. All this makes it difficult to track the provenance, authenticity of valued goods like diamonds, and status of shipments as it circulates along the supply chain. This causes friction in the Global trade.
Being a decentralized and append-only type ledger, at its heart, the Blockchain produces a permanent and carefully designed record. This new sort of record-keeping has been proclaimed as an effective solution that could change businesses which are prone to data-manipulation, data loss and where a streamlined method for tracking of the diamond throughout its lifecycle is required.
For instance, Everledger has placed about 1.6 million diamonds on the Blockchain. With each diamond, a record entry is made in this distributed database. The records have attributes like its color, carat, cut, shape, certificate number, authentication ID, which can be etched on the real stone.
All this implies the creation of a look-alike of the diamond on the Blockchain.
Another example is Luxchain which is the future of luxury product authentication. Built on the powerful AI and Blockchain technology, they offer counterfeit identification based on multiple factors authentication.
The process is such that the owner begins authentication by sending it to the verifier. The verifiers scrutinize the data and validate the same which indicates a guaranteed product with complete authenticity. A duplicate copy or a digital asset is created along with supporting evidence which includes detailed product information and history that cannot be manipulated. This item can be sold now by the owner on any platform such as an e-Commerce site or a marketplace. Every time the item goes through a certain phase of processing, we can ensure that the blockchain database has a copy of the same which is permanent.
Such transformations in the supply chain of highly valued products with Blockchain at its backend promises faster, traceable, secure supply chains and consumer confidence-which is undoubtedly a luxury.