Stemming the flow of illegal ‘conflict diamonds’ in international trade was massively boosted by the Kimberley Process (KP), established in 2000. This rigorous, UN-backed compliance system stands to become even more effective using Blockchain – a proven, distributed database trading technology that creates permanent, encrypted, tamper-free records.
What is Blockchain? And how does it work? Blockchain brings together buyers and sellers in a secure, online environment via pseudonymous user names. Neither party is required to share any personal identity or geographical data. And they can transfer value without the need for a central ‘third party’ or clearer like a bank – delivering big cost reductions.
Critically, by using a ‘permissioned’ rather than decentralised, public Blockchain approach, total security and control are maintained. This means an organisation can open its system only to trusted, vetted users who can update and maintain the network collectively. Blockchain encrypts all personal data, as well as its continuously growing list of transaction records.
Blockchain is a digital ledger that keeps a record of all transactions taking place on a peer-to-peer network
Making ‘conflict diamonds’ history If all legitimate diamond trading can take place under the transparent umbrella of permissioned, risk-free Blockchain transactions, the KP pilot could spell the end for the illegal diamond market worldwide. The ultimate winner is trust – reinforced by every Blockchain-supported transaction.
James Bernard Director of Business Development, DMCC