Here’s How Blockchain Will Remove Inefficiencies in Global Mining Supply Chains
A report published yesterday by international law firm White & Case claims that blockchain technology could help improve transparency and remove inefficiencies from the global mining supply chain. It states that the industry’s adoption of the innovation backing Bitcoin is a matter of “when, not if.”Blockchain Looks Set to Disrupt Traditional Mining IndustryThe report was produced by Rebecca Campbell and Andrzej Omietański of White & Case. Titled “Digitalising the mining & metals global supply chain: Rise of blockchain and the smart contract,” it explores the various ways in which the supply chain of various mined materials could be improved using blockchain technology.During the report, definitions of both blockchain technology and smart contracts are offered up before each of the related technology’s potential to impact on the mining industry is assessed.The authors state:“With today’s pressured margins, inflationary costs and murmurs that the hard-won productivity gains of recent times may be eroding mining companies are looking for ways to improve efficiencies.”They then go on to state that using blockchain technology used to track mining supply chains could increase transparency in the industry, as well as helping to eliminate fraud.Meanwhile, in the section dedicated to smart contract technology, the authors state that blockchain-based contracts could be used to fund mining operations – in much the same way as they have been used to fund various companies using initial coin offerings (ICOs) – or by helping to alleviate disputes between parties:“Moving contracts onto a blockchain will not in itself prevent disputes, but it may help arrive at a mathematically certain set of facts, which could be used to prove a chain of events with a high degree of certainty in the event of a later dispute.”The report then addresses the various challenges that blockchain and smart contract technology faces before it is widely adopted in the mining industry. One of the major concerns for the authors is whether smart contracts would need to be assembled by lawyers or computer scientists. The recent case of the EOSBet smart contract hack suggests that perhaps a mix of both professionals would likely be preferable.Whilst the White & Case report seems optimistic about the use of blockchain in the monitoring of global supply chains, the CEO of Tradeshift stated this week that the technology is by no means ready for the kind of scale required for such tasks.Like Campbell and Omietański, Christian Lanng believes that the innovation could have a dramatic impact on the way supply chains are operated. However, he does contend that it will only really take off in the next five to 10 years, rather than the immediacy implied in the White & Case document.Featured image from Shutterstock.