LMBA to Create Standards for Companies Offering Blockchain-Based Gold Tracking Systems
The London Bullion Market Association, which represents the gold and silver markets, wants to create a set of standards for blockchain-based gold tracking system providers.
The London Bullion Market Association (LBMA) intends to increase transparency in the gold market by opening the door for companies that leverage blockchain to track the metal through its supply chain, Reuters reports. By using blockchain, which is a type of distributed ledger technology (DLT), companies aim to ensure that the gold is not mined illegally or used to finance terrorism or conflicts.
In March 2018, LMBA required its 144 members to suggest gold tracking methods that would prevent forgery. The members, which include the world’s largest miners, refiners, banks, and dealers, would benefit from a decentralized system that guarantees transparency, improves interaction within a network, and automate processes. So far, LBMA has 26 proposals coming from various entities, from startups to established tech firms, according to Sakhila Mirza, LBMA’s executive board director. However, she didn’t want to provide any specific names of the companies, but sources familiar with the matter told Reuters that IBM was one of them. IBM representatives declined to comment.
Instead of picking particular firms to develop the blockchain-based infrastructure, the LBMA took a different path – the organization wants to build a standards framework for services and establish a monitoring body to approve and oversee blockchain providers that meet the stipulated standards.
“We need to set up criteria and standards that help us understand what is a credible blockchain solution,” Mirza said.
“Once those have been appropriately established, the result would be a selection of service providers that meet the minimum standards,” she added.
Mirza revealed that the LBMA hadn’t emphasized the use of blockchain, but the overwhelming majority of the proposals, over 20 out of 26, focused on blockchain-based supply chain tracking systems.
She stated that LMBA’s first draft of standards for tracking system would be discussed in the first half of 2019, while the approval of technology providers would start later in the year.
In January, we reported that Mirza had suggested that blockchain might be a great technology for tracking gold.