NEW YORK, United States — International Business Machines Corp., a group of four gold and diamond industry companies and an independent laboratory are developing a blockchain network for tracing the provenance of finished pieces of jewellery from mine to store.
The TrustChain Initiative, which will run on IBM’s technology, includes precious-metals refiner Asahi Refining, US jewellery retailer Helzberg Diamonds, precious-metals supplier LeachGarner, jewellery-maker the Richline Group and verification service UL. Other industry players may join the effort as well, said Jason Kelley, general manager for blockchain services at IBM. Products being tracked through the program should be available to consumers shopping for jewellery by year-end, according to a joint statement Thursday.
TrustChain is the latest effort by the jewellery industry to use blockchain — a digital ledger that is immutable — to prove to consumers that their purchases don’t include blood diamonds or conflict metals and are ethically sourced. IBM has also been actively helping form a slew of blockchain-focused companies and industry initiatives around various supply chains. For example, it’s working with companies like retailer Walmart Inc. to trace food products, and earlier this year helped start an effort to track international cargo. Providing technologies to such projects is a huge growth opportunity for Big Blue, which has already grabbed the biggest portion of the world’s blockchain-related spending.
Jewelry tracing is becoming increasingly important for business, as the younger customer is "far more skeptical, does more research," said Mark Hanna, chief marketing officer at Richline. "We feel this is an absolute must right now."
TrustChain has just completed its first proof-of-concept test, in which gold went from a mine in South Dakota to a refinery in Utah, to a fabricator in Massachusetts that converted the gold into casting nuggets and grains. Those then went to a manufacturer in India that made engagement rings and set diamonds in them. The rings went to a distribution facility and then to Helzberg. UL, which helps companies ensure responsible purchases, monitored the transactions throughout the process.
Earlier this year, top diamond miner De Beers Group said it’s working to harness blockchain technology to track the gems. Startup Everledger has been tracking diamonds since 2015, and has already traced provenance of more than 2 million stones. The London Bullion Market Association, which oversees the world’s biggest spot gold market, is looking at using the digital ledger to trace the origin of metal, to prevent money laundering and to detect conflict minerals.
By Olga Kharif, with assistance from Gerrit De Vynck; editors: Nick Turner, Jillian Ward and Molly Schuetz.