How Smart Contracts Have The Potential To Transform The Entire Jewelry Supply Value Chain

Smart contracts are smart in every sense of the word! First, they are able to recognize frauds and second, they are capable of maturing independently without the validation of any third party. With smart contracts, the first goodbye can be said to the third party remittance partners. We have nothing personal against remittance partners except for the fact that they have the habit of overcharging. While we speak about the diamond industry in particular; third party remittances have been a major pain area. They have complicated the entire transactional process with multiple paper works and local blockages which otherwise can slow down the entire trading network. The turnaround time of a diamond from a mine to the fingers of a newly engaged couple increases significantly with paper-based remittances which are like bottlenecks in a coherent ecosystem.

Smart contracts promise to be about a significant amount of coherence to the existing supply chain of diamonds. By large, the smart contracts would ensure 3 fundamental factors that would completely redefine the entire ecosystem of the diamond trade. They are:

• Provenance – Smart contracts would be able to identify authentic diamonds originating from mines in non-conflict regions. Once a diamond’s origin is traced back as a blood diamond; the contract would cancel out automatically. This practice would automatically remove the blood diamond traders from the existing ecosystem and establish a very clean system of trade.
• Authenticity – There is a common complaint from the diamond industry regarding the origin and authenticity of diamonds. Some diamonds can be artificially created in labs by fabrication using diamond dust.
• Traceability – The traceability of diamonds is a very important factor that needs to be taken into consideration especially with so many fakes and blood diamonds flooding the markets. The traceability of diamonds helps in preventing unauthorized transactions from getting verified and validated. This ensures a nearly perfect diamond trading ecosystem.

Smart contracts will eventually become the backbone of the diamond trading network. Today, there is serious hope for the diamond industry with a platform that will minimize complications along with a smooth platform to facilitate quick trading!