Differentiating diamonds: proving the provenance of precious gems

Louise Mercer, chief experience officer at Everledger. Image: Everledger

It’s been a journey, definitely. We've had significant growth over the last 12 months or so and we have learned a lot. The throughput rate for diamonds on our platform is about 12,000 a day, but we’ve broadened it so we can ingest much more data at scale. At the moment, we're converting all our existing clients into the new platform. It’s a fantastic opportunity for us to increase the scope of our work with the suppliers and it also gives them the potential to connect with new retailers.

We started with diamonds and gemstones, which was really important given the history and challenges facing those commodities, but we are now expanding to other asset types, such as fine wines and batteries. We’ve been working on many projects, including at the consumer end, and it's great that we now have initiatives spanning the full value chain. I think it's fair to say, though, the industry is definitely facing challenges, you can't ignore that.

Some businesses are focused on doing what’s needed to get by, while others are saying now is the time to invest in things like our technology, so as markets open back up, they’ve got a point of differentiation. It’s horses for courses and depends on the strength of the balance sheet. But part of the value we're offering the diamonds and gemstones industry is more digital commerce, to convert a bricks-and-mortar store into a digital enterprise that is backed by trust.

I think the way technology is advancing, with augmented reality and virtual reality, retailers want to enhance the customer buying experience. And that is what we do, by ensuring the consumer gets what they paid for, and knows where their gem came from and, importantly, has trust and confidence in that knowledge.

We very strongly believe it's a growing space. That is evidenced anecdotally and in real terms from customers’ experience with their end consumers. It's gone a long way, and I think another Covid-19 impact is a broader awareness of supply chain and origin and where stuff comes from. Sustainability is a massive growth area and evidencing where something originated, for a whole variety of reasons, including peoples’ desire to support certain economies and stories - we’re connected with the Women Miners Association in Tanzania, for example - can set sellers apart.

This is actually where I think blockchain has a lot to offer rather than less. Instead of relying on a single endorsing party that could be compromised, we can send information across the network and search for providers and data that substantiates different aspects and that gives a more complete picture of truth and trustworthiness.

It all comes back to data quality. We spend a lot of time on this and there's different aspects to it. One is just standardisation and normalisation of data sets across industries that have never standardised or normalised before, and that's a challenge. But that then provides at least a common function and language for comparison and searchability.

We apply logic and standard practices and invoke third party auditors to help our customers put their best foot forward. So, you know, if you're lacking a Kimberley Process certificate, if you're lacking a third-party grading certificate, if your data doesn't line up, if your diamond is cut and polished but then gains weight, it will show on the system.

The immutability of record keeping immediately enhances trust and I don’t think blockchain infrastructure has been fully realised yet, I think that will come into play as we scale.

We have introduced more control for users just starting out. People joining our platform can get their own data in order and prepare themselves to be more discoverable, but keep their data private. Others can either make the data public across the platform or permissioned, which is when a retailer might be searching for a particular type of stone, they discover it, and want to make inquiries they can message that provider and connect with them. We know having more control is quite important for our customers.

Customers can also demonstrate their sustainability credentials, upload their reporting, and offset their own greenhouse gases through our platform. That's another really important aspect for our suppliers to differentiate themselves.

The WeChat Mini Program and Alrosa is key to this; China is a massive market for gemstones and jewellery, and just about everything gets done in China on WeChat. It's contacts and communication, transactions, it's conversational commerce. And so, the ability to trade stones in that environment and to have provenance on demand to substantiate a trade I think builds legitimacy and trust in the market. It's very sensitive to it.

So Chinese consumers are looking for that kind of evidence, they hold certificates in high esteem. Growth in China is a big area of focus for us in the next year or so ahead. For us, as we grow, I think our repertoire of what we'll produce from a recording and dashboard perspective will grow as well and we have several big announcements to make very soon.