Gold industry adopts Blockchain technology for supply chain management

Some of the gold industry’s most well-known companies and individuals have teamed up to develop a new “integrity program” that uses blockchain technology for supply chain management, with the goal of assisting market players in confirming the legitimacy of their bullion.

This Monday, the London Bullion Market Association (LBMA) and the World Gold Council (WGC) announced that they are working together to create a blockchain-based “international system of gold bar integrity, chain of custody, and provenance” developed by aXedras and Peer Ledger. 

The ledger will be used to register and monitor gold bars at every stage of the production and assembly process, including mining, vaulting, and jewelry manufacturer sales.

Organizations such as CME Group, Barrick Gold, Metalor, Brinks, Newcrest Mining, Hummingbird Resources, Royal Canadian Mint, Argos Heraeus SA, Aura Minerals, Asahi, Perth Mint, and others are supporting the so-called Gold Bar Integrity Program.

The program, which is initially established as a pilot, will eventually be encouraged for usage across the gold industry, according to the LBMA and WGC.

Our CEO David Tait and LBMA CEO Ruth Crowell today announce the launch of a new Gold Bar Integrity Programme. Together with @lbmaexecutive, we will develop and implement an international system of gold bar integrity, chain of custody and provenance: https://t.co/jcZ6V1wYLB pic.twitter.com/x7klqZ8WTL

— World Gold Council (@GOLDCOUNCIL) March 28, 2022

Blockchain helps in supply chain management

One of the most potential applications of blockchain technology is supply chain management. Notably, more than half of the organizations on Forbes’ 2021 Blockchain 50 list are companies that are actively employing distributed ledger technology to tackle supply chain and logistics concerns. Lockheed Martin, an American defense contractor, said in April 2021 that it was employing blockchain technology in Switzerland for the supply chain management.

Illegal mining, illicitly laundered gold, fake gold bars, and human rights violations have made the gold industry particularly vulnerable to supply chain secrecy. The Organization for Economic Cooperation and Development (OECD) published a report in 2020 that outlines how gold companies should avoid contributing to “serious abuses” in the mining and manufacturing process.

It is good to see that other sectors, especially the one which is a competitor of the Blockchain industry, are adopting its technology. In December, Pro Bitcoin and MicroStrategy CEO advised everyone to sell their $10 trillion valued gold to buy Bitcoin.