The London Bullion Market Association (LBMA) is planning to launch the blockchain-based gold project tracking system for greater transparency. The project will help bring modernization in the industry with due approval from the companies that use blockchain technology already for tracking the gold’s movement. One of the reasons that gold mining companies are turning to blockchain is to exclude the illegally mined or traded or with a history of financial conflict metal from the global supply chain.
Revelations such as the acceptance of billions of dollars smuggled gold from South America by a U.S. refinery have triggered off the need for blockchain-based technology implementation in this field to bring better transparency and higher efficiency.
LMBA has been trying since long to come up with a solution to keep up the illegal gold trading at bay. In March this year, the association asked its 144 members including the largest gold refiners, dealers, and banks in the world to develop a proposal for tracking gold and curb the incidences of forgery.
Now that the other sectors in commodities have adopted blockchain-based project tracking system; it is high time that the gold market also adopts it sooner. With the help of this technology, it is possible to share database, process and settle the transactions within a few minutes without any requirement/intervention from third-party verification, Reuters reported.
According to the executive board director of LBMA Sakhila Mirza, they have received 26 proposals from companies including major technology firms and startups. Instead of naming or endorsing companies who have come up with the proposals, LBMA has instead decided to create a set of standards for services and form an oversight committee that will approve and monitor technology providers meeting them.
While discussing the implementation of the project tracking system, Mirza stated, “We need to set up criteria and standards that help us understand what a credible blockchain solution is. Once those have been appropriately established, the result would be a selection of service providers that meet the minimum standards,” Cryptovest reported.[The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views and/or the official policy of the website. ]