Blockchain technology is coming to commodity markets, according to Blythe Masters of JPMorgan Chase & Co.
Speaking at this week’s London Metal Exchange annual dinner and reported first by Bloomberg News, Blythe said the virtual ledger technology underlying cryptocurrencies promises greater confidentiality, fewer paper exchanges, better provenance, and a boost in productivity.
“Supply chains are notoriously complex and inefficient,” Masters said. “This is especially true in the metals and mining industry where many operational and commercial practices remain inefficient and antiquated, leading to critical data omissions, security vulnerabilities, expenses, corruption, and unethical provenance.”
“Blockchain technology has the potential to impact mining industry supply chains profoundly,” Masters said. There are “tens if not hundreds” of projects under way. “Blockchain facilitates the exchange of critical trade documents, bills of lading, letters of credit between connected users securely and confidentially,” Masters said. “Clearly the indications for metals mining, shipping, storage, and logistics industries are nontrivial.”
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