Focused on improving trading efficiency and helping companies achieve environmental and social governance (ESG) compliance, MineHub Technologies is working with IBM, ING Group, and other entities to create a platform that will help companies of all sizes streamline their procurement activities.
Built on IBM’s blockchain platform, the MineHub solution lets parties involved in selling, buying, delivering, and paying for a cargo of minerals to collaborate securely in real-time. It also enables integrated, cross-company workflows and the sharing of electronic information. In many cases, the latter is handled by couriering or e-mailing paper documents. Both of these traditional options are subject to interception, fraud, and cyberthreats.
Helping Buyers Gain Efficiencies
Now live, the platform’s first release enables miners to capture mineral production and digital contracts with buyers; streamline the post-trade operations (including document flow); and manage financing and logistics, MineHub stated in its press release.
Using the platform, miners capture mineral production and digital contracts with buyers—a process that will ideally help streamline post-trade operations, financing, and logistics. MineHub says the platform fulfills a real need in the $1.8 trillion global mining and metals market, which has traditionally suffered from inefficiencies due to manual, paper-based processes and a lack of transparency among supply chain participants.
“By digitizing the supply chain, increasing levels of automation, and providing greater traceability,” it says, “MineHub Platform users are expected to be able to streamline their operations, improve profit margins, and contribute to sustainable supply chains and responsible sourcing.”
A Strong Foundation
The blockchain system being used by the MineHub platform was developed through a cooperation between IBM and MineHub, according to Blockonomi’s Robert Devoe. The system uses Hyperledger, a blockchain system created by IBM that was targeted squarely at large corporations and does not have a “coin” of its own.
“In simple terms, Hyperledger is a competitor with Ethereum and is designed for companies and groups to build on it to achieve their own goals,” Devoe writes, noting that MineHub’s platform features include on-chain contract management and completely traceable “mine-to-market” accountability. “The system offers features that support credit and other financing functions,” he writes, “as well as invoicing and payments processing and tracking.”
The system also tells users exactly where a given shipment, product, or operation is at any moment—providing new levels of on-demand insights. “What’s particularly interesting about the platform’s offering is the use of smart contracts to automate dozens of operations that previously had to be done on paper or by a person,” Devoe concludes. “The automation of smart contracts could allow for transactions to become incredibly seamless and fast, saving millions of dollars and thousands of labor hours.”
Who Can Use it?
MineHub says its platform can be used by a wide variety of company types and sizes, including small to mid-sized businesses (SMEs) and large corporate miners; trading houses; financial institutions; alternative financiers; and logistics companies, among others.
“MineHub is another example of ING’s commitment to innovation and improving our customers’ businesses,” said ING’s Arnout van Heukelem, in the press release. “This platform will not only further improve our customer service benchmark but also enable us to help our customers across products and functions.”
“By providing an immutable record of transactions, MineHub is already helping its members streamline operations, improve key process efficiencies, and bring a new level of trust and transparency,” IBM’s Manish Chawla said in the press release. “We anticipate considerable reduction in disputes on assays and logistics events by automating the capture of mineral provenance data. This is an exciting advancement that will pave the way for traceability reporting as well.”
Devoe is bullish on the potential not only for the MineHub platform, but also for other new innovations that could follow in its footsteps. “If the mining industry is willing to make this kind of bet on smart contracts and Hyperledger,” he writes, “just imagine what we might see in the coming years from a variety of big industries.”