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Eco-DLT can add to the volume of global trade of $1 trillion

Written by forex

The world economic forum published a report Building Block(chain)s for a Better Planet, which outlined 65 promising directions for the use of DLT technology to reduce environmental damage from hazardous industries.

The WEF experts have identified a number of industrial segments, where it can be used DLT: tracing the path of supply, management of energy and water, management of emissions of greenhouse gases, and changing the system of financing production. All of them are present in the industry of mining. One of the most significant problems of the commodity sector — the “dirty” technology. Moreover, environmental security is often directly depends on the economic efficiency of the enterprise. In other words, the better controlled cycle times, built logistics or rather, the less production pollute the environment.

And here a paradoxical situation: the largest number of emissions is exactly the industrialized countries. For example, first place in CO2 emissions is China — 10 357 million tons, the second place United States — 5 414 million tons, further India — 2 274 million tons, and closes the top ten leaders in emissions in Canada is 557 million tonnes.

At first glance, the problem is simple: the more production, the more emissions. But what about the severe environmental requirements and the increased attention of regulatory bodies in the States-leaders of the world economy? Well, China and India. They may not be so concerned about their future, there would with the real deal. But in the top 10 “dirty” countries include Germany, Japan, and the United States. These countries are difficult to accuse of indifference to the problems of environmental clean-up.

Obviously, the root of the problem deeper. A significant proportion (if not the biggest) of emissions falls not on production but on the transport system, that brings raw materials into the manufacturing industry, and then to the consumer.

“Commodities are in the supply chain from production and processing of materials to final product and user”, says Professor, Chairman of the Board of Directors of the company Cobalt Blockchain Inc. (Toronto, Canada) Samuel PERALTA. — “The blockchain can be applied to the supply chain to ensure transparency and completeness of databases. For example, in cases where the source of raw materials, product or the conditions under which it is manufactured, must meet stringent requirements. And this is especially true of those branches of the commodity production, which should be strictly adhered to humane conditions of work”.

But this problem is not limited to: environmental challenges here are closely related to the social. By the way, Canada ranks second in the world for the extraction of cobalt (6%). However, 60% of the raw materials needed for the production of batteries for every modern gadget, produced in the Republic of Congo.

According to Amnesty International, every day in this African country descend into the mine from 110 to 150 thousand miners. Of these, approximately 40 thousand children. Shift worker mining production lasts 12 hours. Earnings — $1-$2 a day. The price of this mineral for the last 5 years has grown three times.

Cobalt dust can cause diseases of the heart and lungs. Working on this production rarely live up to 50 years. And most importantly, that pushing people this hard and dangerous work — poverty. At the moment, many experts believe the emergence of digital assets the result of unfair wealth accumulation. And as a consequence instrument of redistribution from the 1% beneficiaries of the global economy to 99% of manufacturers. If, according to the WEF, DLT and virtual assets to help create a new system of financing of primary industries?

“Decentralized databases in the first place, affect the business efficiency and trust”, — says General Director of the company Minespider Nathan WILLIAMS (Berlin, Germany). — “Companies are looking for new advanced technologies to help accelerate payments for raw materials, to reduce the risk of corruption by creating a provable link to a responsible source with the same records and reduce the burden of bureaucracy by moving paper documents in a secure, unchanging electronic forms. It will make the economy more efficient”.

Agrees with him and our other companion, FINTECH consultant from Canada Tariq Ali ASGHAR: “In my opinion, outdoor DLT-the registry is a real decentralized system of trust account. The existence of such a tool is particularly important for oil and gas, metals and raw materials industries. Accordingly, the recorded raw-materials supply chain for each company or group of companies — the guarantee of equal cooperation and maximum optimization. This will reduce transaction costs and to eliminate other bottlenecks in a modern centralized system”.

Independent and authentic commit rights able to give birth to a legally fair structure of the world economy. But she cannot guarantee that the monetization of the natural resources of underdeveloped countries. Can I receive digital assets tied to commodities and production sector of the economy? How effective they would be in the current economic conditions?

“This, of course, depends on bound virtual assets”, says Samuel PERALTA. — “It is necessary to consider the economic system, which is embedded in the supply chain of raw materials. However, digital coins can be an incentive for, for example, compliance with humane working conditions. In this case, the virtual coins may take a value which is much higher than the product of production — raw materials”.

However, a partial solution of tasks in support of production processes in the framework of the efforts of individual companies — is just a special case of concern about the fairness of the distribution of profits, a cleaner environment and improved working conditions. To change the negative traditions of the commodity business, this is not enough.

The WEF sees the solution is to create a global system of distributed registry for certain areas of the economy. But you need to answer three main questions: can this technology affect the solution of specific environmental problems, whether the management of the individual unintended risks and the appropriateness of new technologies to all market participants? As we can see, business responds to it positively. The authorities of many countries while fluctuate in establishing the legal framework governing the application of new production and, most importantly, legal techniques.

However, progress is inexorable. According to the WEF, in the next ten years DLT-technology can add to the volume of global trade of $1 trillion. The key word here is “can”. It will happen only if politicians will find the courage to accept the new digital reality as a given, not as a threat to the usual order and its status.

By the way, if this happens it will be the first environmentally friendly and morally clean trillion in the history of mankind.

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