Blockchain Technology in the Mining Industry

Miners can achieve greater security and increased productivity using blockchain tech.

new copper projects

Many industries often overlap and there is no better demonstration of this than the intersection of cybersecurity, fintech and mining. And no, we’re not talking about bitcoin mining. According to Softpedia, since 2010, 22 mining companies have reported major cyber attacks. Arguably cybersecurity and mining are on a collision course, but fintech offers a way out, with its blockchain technology.

Accenture Consulting report that attacks range from hacking private information, hijacking intellectual property, or knocking an M&A off course. Symantec’s Internet Security Threat Report shows that mining tops the list of industries receiving spam email, though it should be noted that there is not much difference in the numbers regarding other industries being spammed. However when around a third of emails have a virus, it’s not a list anyone wants to top. That is why the mining community is turning to blockchain. Blockchain cuts out any middlemen, which affords less time to hackers trying to steal data. As well as adding an extra layer of security, blockchain could drive productivity in the following areas:

Internet of Things (IoT)

More connected devices means more data generated. In order to process this effectively, blockchain could be used, in the form of IBM’s (NYSE:IBM) Autonomous Decentralized Peer-to-Peer Telemetry (ADEPT) system. Basically this allows an IoT to run itself. For example, a digital ledger links a vehicle with a warehouse, so that they can talk and order new stock, with payment processed on delivery.

Cost reduction

As mines operate all over the world, the expense of cross-border payments is a problem for the industry. Remittances are undergoing huge change thanks to blockchain. Not only could blockchain solve a security issue but it could also speed up the process of paying. DigitalX’s (ASX:DCC) mobile product AirPocket provides consumers secure overseas transactions from anywhere, in any currency.

Tracking

High-value metals and minerals like rough diamonds could be tracked from the ground to the seller and eventually to the buyer. This would help eliminate illegal activity and blood diamond trade. Work is facilitated in this area by fraud detection systems like Everledger.

Streamline contracts

“Smart contracts” are a chain of commerce and a way of remotely policing workers. If a gold mine is in Cambodia or another developing country, and the firm is headquartered elsewhere, business standards can still be upheld everywhere. For instance, the world’s biggest mining company, BHP Billiton (NYSE:BHP), are using blockchain for their supply chain. They have a market cap of $102.74 billion, so certainly have some market muscle and could influence other, smaller players to follow suit.

To conclude, far from hindering production, blockchain is a security solution that improves results and safety. Spreadsheets could be a thing of the past if uptake of blockchain continues. Mining is a dangerous job so anything that can be done to ensure good practice is a step in the right direction. Investors would do advised to further research the companies mentioned and capitalize on a future trend.

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Securities Disclosure: I, Emma Harwood, hold no direct investment interest in any company mentioned in this article. 

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