A leading Hong Kong jeweler will utilize blockchain technology to sell diamonds and other precious gems to customers, according to the South China Morning Post.
Hong Kong Businesses Deploy Blockchain
Chow Tai Fook, a Hong Kong-based jewelry retailer with locations in China, Vietnam and Singapore, has partnered with Everledger, a blockchain solutions provider, to promote transparency and increase trust in the diamond purchase process across its stores.
Initially, the blockchain-based process will be limited to four retail outlets in Hong Kong–including Causeway Bay, Tsim Sha Tsui, Mongkok and Tuen Munu–all of which carry T Mark branding, a Chinese quality standard graded by the Gemological Institute of America.
The move follows De Beers’ development in May, which saw the diamond seller pledge to integrate blockchain technology into its core business to increase customer trust.
Chow Tai Fook’s effort is powered by IBM’s enterprise blockchain platform, a cloud-based, open-source software that promises massive network scalability via native Hyperledger protocol. Meanwhile, Everledger provides end-to-end design, structure, implementation and onboarding a blockchain to a company’s running infrastructure.
Using the T Mark’s mobile application to scan QR codes, consumers can determine the origin and authenticity of stones sold in Chow Tai Fook outlets. The new feature will show exactly where a particular gem was sourced from and display its “grade.”
The system will also digitize a diamond’s certificate of authenticity during mining, which shoppers can access while buying any stone from the company.
Alan Chan, general manager of group branding within Chow Tai Fook’s Jewellery Group, said:
“The retail industry is undertaking a digital revolution, and this serves as one of the key drivers of this pioneering initiative.”
Keeping Up with the Times
Chan added that millennial customers form a growing part of the company’s business and are interested in understanding the “entire life cycle” of a product. Therefore, companies must maintain their core ideologies while integrating newer technologies to remain relevant to the next generation of consumers.
Meanwhile, Kent Wong, the group’s managing director, believes blockchain technology can help customers manage their assets “conveniently and efficiently.” He noted that diamonds are an invaluable, long-term investment for most customers and such a system may enrich their knowledge regarding the purchase.
Chow Tai Fook executives claim more than 3,000 T Mark diamond reports have been filed on the blockchain, with further plans to expand to 10 stores and 10,000 diamonds.
In an industry characterized by fraud and lack of authenticity checks, the development marks the first instance of a diamond retailer providing grading information directly to a customer, which officials consider an industry breakthrough.
Cover Photo by Simon Zhu on Unsplash