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When shoppers buy an engagement ring from online jewelry retailer <\/p>\n
But customers looking for further proof that their diamond was refined ethically can add an extra filter: blockchain-enabled. While blockchain diamonds may sound futuristic, the technology allows consumers to see detailed information about an ordinary diamond\u2019s journey, from where it was sourced and manufactured to pictures of the rough diamond and its original lot number.<\/p>\n For <\/p>\n The company partnered in 2018 with Everledger, a blockchain-based digital ledger platform, to roll out its blockchain-tracking system. Brilliant Earth now lists upward of 10% of its diamond inventory on the blockchain, and plans to keep increasing that number.\u00a0 The online jeweler declined to say how much blockchain certification adds to its cost of producing a piece of diamond jewelry.<\/p>\n Brilliant Earth could use some luster with investors. Its stock has lost over 55% this year, battered by pessimism against speculative growth stocks due to expected interest rate hikes. More recently, shares took a hit when Russia invaded Ukraine and the U.S. placed sanctions<\/a> on Russian miner Alrosa, the largest miner in the world that accounts for 90% of Russian diamonds<\/a>, and 28% of global mined diamonds.\u00a0 In response to the invasion, Brilliant Earth has removed all Russian diamonds from its website.<\/p>\n Blockchain is emerging as an attractive option for other companies that are looking to emphasize their\u00a0compliance with ESG\u00a0<\/strong>guidelines <\/a>. It\u2019s especially popular in industries that have fielded questions over environmental and human right concerns across their supply chains, such as the fashion industry, the chocolate and coffee industries, and even lithium-ion batteries\u2014the driving force behind electric vehicles.<\/p>\n Retail giant <\/p>\n As a digitally distributed, immutable, and decentralized ledger, blockchain makes it easier for companies to record transactions and track assets in a network\u2014-and share that information with customers, suppliers, and investors with the assurance that it hasn\u2019t been tampered with.<\/p>\n \u201cWhat blockchain has done is combine all of that together in a single killer protocol that enables us to be able to connect globally this information and synthesize it, secure it and enable its truth to be a single version globally,\u201d said Everledger CEO Leanne Kemp.\u00a0<\/p>\n Proving sustainability standards has been challenging for the diamond industry, which has been plagued with concerns over \u201cblood diamonds,\u201d or rough diamonds sold by rebel groups to fund conflicts, money laundering and terror financing, said Cormac Kinney, CEO of Diamond Standard, a start-up trying to standardize the trading of diamonds.\u00a0<\/p>\n Even large mining companies have struggled to certify exactly where a diamond was mined, cut, and polished from start to finish. The first time a diamond was digitally tracked from mine to store was in May 2018, when mining giant De Beers announced it had followed the journey of 100 high-value diamonds using its blockchain-powered platform called Tracr.<\/p>\n \u201cThe diamond industry is one of the last remnants of, really, the 1900s, where the entire industry is dark,\u201d Kinney said.\u00a0<\/p>\n Consumer sentiment, especially among younger generations, is rapidly shifting in favor toward jewelers with transparent and socially responsible supply chains, said Cowen analyst Oliver Chen. In an annual filing with the Securities and Exchange Commission, <\/p>\n Blockchain won\u2019t be a panacea for the diamond industry\u2019s sourcing dilemma. Perhaps the biggest challenge is changing the opaque nature of the diamond industry itself, right down to the definition of what entails an \u201cethical\u201d diamond. Most diamond retailers and miners comply with the Kimberley Process, a United Nations initiative that creates oversight to prevent the trade of conflict diamonds. Some critics point out that the Kimberley Process doesn\u2019t encompass other human-rights violations that occur throughout the diamond-supply chain.\u00a0<\/p>\n Still, blockchain certification represents a big change for a secretive industry. Diamonds are unique by nature, allowing blockchain software to easily capture the physical identity of a diamond and turn it into a digital asset that can be logged into the blockchain. Once it\u2019s on the blockchain, that record is indelible and anyone with access to the chain can see it.\u00a0<\/p>\n When Brilliant Earth buys a blockchain-enabled diamond from a mining operator, the diamond\u2019s unique identifying characteristics are automatically logged onto the blockchain. That record follows the diamond throughout the cutting and polishing process and right down to the moment a consumer purchases the stone\u2014an event that also gets logged in the blockchain, cementing the new owner\u2019s possession of both the physical and digital asset.\u00a0<\/p>\n Tracr, De Beers\u2019 blockchain-tracing initiative, also uses robots to scan and log a diamond\u2019s unique data point to turn the gem into a digital asset before selling it to a rough diamond buyer.<\/p>\n \u201cDue to the fact that blockchain uses a distributed ledger, where all participants validate the accuracy of the data, the technical traceability solution provides assurance in a way that wasn\u2019t previously possible,\u201d a De Beers spokesperson said in an email.\u00a0<\/p>\n Write to Sabrina Escobar at\u00a0sabrina.escobar@barrons.com<\/a><\/p>\n<\/div>\n
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\n Brilliant Earth
\n <\/a>,<\/span><\/span>
\n they can filter through the usual diamond specifications\u2014cut, color, clarity, and carat\u2014-and the assurance of obtaining an ethically sourced diamond.\u00a0<\/p>\n
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\n Brilliant Earth
\n <\/a><\/span>
\n (ticker: <\/p>\n
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\n BRLT
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\n), using blockchain to bring transparency to the opaque world of diamonds was a no-brainer, said CEO Beth Gerstein. \u201cWhen I was getting engaged, I would go into different jewelers, and I\u2019d ask, \u2018Where does this diamond come from?\u2019 I never got a straight answer,\u201d she said. <\/p>\n
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\n Walmart
\n <\/a><\/span>
\n has used blockchain technology from <\/p>\n
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\n IBM
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\n to increase transparency and traceability in the supply chain for leafy greens and bell peppers. Blockchain makes it easier to pin down specific batches in case of a recall or regulatory requests for information, the company said.<\/p>\n
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\n Signet Jewelers
\n <\/a><\/span>
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\n SIG
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\n) identified changing consumer attitudes as one of the key risks to its business, especially if they were negatively influenced by concerns over the source of raw materials, the impact of mining on the environment, labor conditions in the supply chain, and the impact of production on local communities.\u00a0<\/p>\n