UK Firm Launched Blockchain Pilot to Aid BMW

Renowned auto giant BMW has partnered with London-based start-up Circulor to use blockchain technology to track batteries for its electric vehicles that only use clean cobalt, said the CEO of the start-up.

Working with emergent technologies such as artificial intelligence (AI) and blockchain, Circulor aims to provide solutions to trace the origins of certain products and improve the efficiency of global supply chains.

Blockchain, the underlying technology behind cryptocurrencies such as Bitcoin, will be used to eradicate the usage of battery minerals made using child labor.

About two thirds of the world’s supply of cobalt comes from Democratic Republic of Congo, where almost a fifth of cobalt is mined in unregulated mines. A major reported problem in Africa is the use of child miners, with as many as 40,000 children working in the mines of the region of Congo in 2014 alone.

Human rights group Amnesty International claimed that almost half of the 28 largest companies that use cobalt in their products, including Microsoft, Huawei, and Renault failed to prove the provenance of their cobalt. The group also added that electric automakers such as Tesla and BMW also needed to put more efforts in disclosing the source of their cobalt.

The tech start-up Circulor said that it was in the process of developing a pilot for BMW to find cobalt that is presumably clean because it originates from countries like Australia and Canada or from Congo’s industrial production, said the company.

A spokesperson from BMW said the firm could not make any comments at this stage.

“We believe it makes economic sense to start with sources that aren’t a problem,” said CEO of Circulor Douglas Johnson-Poensgen in a Reuters interview.

Once the system is proven and operating at scale, one can tackle the harder use cases like artisanal mines.”

Johnson-Poensgen said that the pilot will be able to give clean cobalt a barcode and “enter the main stages of its journey on to an immutable ledger using blockchain technology”.

Due to it being an efficient way to determine if the cobalt is clean, it is implied that it could also have the potential to reduce regulatory compliance costs, although the economics behind this claim still remains to be validated.

Johnson-Poensgen is a former army engineer that was involved in the bomb disposal in Sierra Leone and Bosnia, and having also worked at big corporate institutions, including Barclays Bank and BT.

Circulor was established last year by him with the purpose of offering a solution for automakers that are looking to reduce the costs of electric vehicle manufacturing to make it profitable.

Glencore dominates the industry of cobalt production in Congo.  While it has claimed that it would never use children to work in their mines, they have declined to make any comments regarding the use of blockchain in this particular matter.

Blockchain companies are starting to create more and more products that will help various sectors of different industries, this being just one of the latest pilots to emerge.

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