Is Blockchain the Missing ‘Link’ to Mining Industry Innovation and Sustainability?
Distributed ledgers, blockchain technology, Ethereum network — all these words have been hot topics for the past couple months, but what makes them special and how can the mining industry use these concepts and technologies to promote growth, encourage transparency and decrease the total amount of risk involved? In short, the answer is security, trust, transparency and data analysis. The question is: how does it work and what does it mean for our industry as a whole? The article below is a brief description on the definitions and potential uses of these disruptive technologies, but what it means in terms of our industry is for every individual and company to decide for themselves, as the applications and advantages are seamlessly endless.
“Without change there is no innovation, creativity or incentive for improvement. Those who initiate change will have a better opportunity to manage the change that is inevitable.” — William Pollard

Distributed ledger technology is a system that allows all data to be synchronized across multiple sites without a central network or central data storage has come to be one of the most disrupting changes in today’s world. This system has been widely implemented by various companies. The distributed ledger comes with many benefits, such as reducing operational or internal risks, where all data is uniformly accessible and changes, fraud or simple mistakes can be easily identified and addressed in time. Another benefit of the distributed ledger system comes from the elimination of a central system, this allows for cost savings where no physical databases are needed, as well as providing a more secure way of storing information. The possibility of peer to peer interaction without an intermediary can save firms money, time and decreases overall risks.

Tracking and Transparency: The possibilities of applications in the mining industry are immense. The use of blockchain technology to implement distributed ledgers can be a powerful tool to any company that decides to walk the path of innovation for future growth, stability and safety. The implementation of blockchain technology for a mining company can be as simple as tracking all transactions, the status of assets and movement of money. Data is encrypted into “blocks” that are difficult to alter and easy to audit. This tracking system will be of benefit to any company for transparency purposes, especially when dealing in developing countries, where questionable spending can be avoided or immediately identified. Blockchain based distributed ledgers provide real-time, fully transparent records of all transactions and contracts, decreasing the overall risk of operation in many jurisdictions.
Security: The blockchain technology, which consists of recording transactions, encrypting them, referencing them to a previously encrypted block of interactions, provides a strong safety net for any data from hacking or alterations, where a hacker will not only have to change a certain target block, but all blocks following that one. The network also relies on peer to peer verification, meaning that if one person’s or machine’s blockchain is altered, the network will reject that sequence, due to the fact that it does not match up with the majority. This safety aspect can be used to protect databases of any kind; and since mining companies gather large amounts of data from day to day operations, which may be highly sensitive data, it will prove to be of great value. One example of theft of such sensitive data, or hacking was seen between 2013 and 2016, where several mining companies and casinos were hacked.
Processing and Analysis: Another different blockchain technology, called “Ethereum” provides a platform for various applications, with its own language and possibility of integration into current platforms and systems. A major advantage of the Ethereum network is that the computing power of such a network is dependent on the amount of users, and with no barriers of entry into the network, the theoretical computing power is limitless. How can this be useful to mining companies? A typical mining company generates hundreds of gigabytes of data (if not more) per day of operation, receiving data from sensors in multiple pieces of equipment and systems. This data usually is left un-analyzed or under-analyzed enough, mainly based on the fact that the sheer amount of data is overwhelming and cannot be properly processed. This is where the Ethereum network steps in with its computational power and may provide valuable insights into the usage, wear, maintenance and performance of overall operations on a daily basis.

The distributed ledger system is a powerful tool in the hands of a company and can lower risks, as well as open doors to various other uses of other technologies. What implications might this technology hold and how can it impact the stakeholders with increased transparency and accountability? This technology can be a tool to build more trust and accountability between parties; it can provide a solid foundation for prosperity for all those involved, and serve as a protective shield against data loss and fraud.
These technologies are advancing at a rapid pace, and many central banks, firms and even governments are implementing trial versions of this disruptive and fascinating technology. As humanity moves ahead through the digital age, the mining industry must follow suit in order achieve maximal growth and minimize the risks, where blockchain technology will play an important role.
As the mining sector has always been slow to adapt to technological changes, it is of even greater benefit for early adopters of this technology, where successful implementation can prove to be a competitive advantage in the field and boost overall business reputation. Some of the major players already using or trialing with blockchain technology are IBM, Delloitte, KPMG, PWC, Earnst & Young, Morgan Stanley, JP Morgan, ANZ, as well as central banks of England, Thailand, Singapore, Russia, Japan and many more. Specialist service providers have already started offering blockchain integrations into your business to help you facilitate the transition into the next generation. How can blockchain technology drive innovation and change at your mining operation, asset transaction or industry value proposition?
“Change is the law of life. And those who only look to the past or present are certain to miss the future.” — John F. Kennedy