Retired NBA player Dikembe Mutombo’s investment firm, Bluetech, alongside international partners, has announced plans to invest $1 billion in ethical cobalt mining projects in the Democratic Republic of Congo (DRC). Blockchain is planned to ensure traceability. Mutombo is originally from the DRC and is looking to bring international investment to his home country.
Cobalt is a mineral commonly used in the production of electric batteries. As electric vehicles are becoming more popular, so the demand for the mineral increases. The World Economic Forum Global Battery Alliance predicts the demand for cobalt used in batteries will grow fourfold by 2030.
Over 68% of the world’s cobalt supply comes from the DRC, with approximately 15% to 30% of the country’s minerals produced by small-scale mining. It is not news that the mining process in the DRC, especially in small-scale mining, often violates human rights. Child labor, fatal accidents, and violent arguments between miners are common. Historically, the mining business in the DRC has been prone to corruption.
With the demand for cobalt increasing exponentially, these issues need to be addressed urgently to create a sustainable and ethically sourced supply of the mineral. This is where Mutombo’s investment comes in.
The $1 billion investment aims to manage the money across public and private mining projects to support conflict-free extraction of minerals used in electric battery manufacturing. DRC’s President Tshisekedi will be working with Bluetech on how to use the money properly, and over 5000 jobs are expected to be created.
A portion of the investment will go towards blockchain-based traceability platforms. The use of blockchain in promoting ethical mining is not new. The idea is that putting data that can’t be altered into a distributed network will diminish opportunities for corruption and human rights violations. However, as with any blockchain, there’s a need for extensive auditing of the data that’s added to the traceable platforms. Although the data can’t be changed once it’s logged, there is no guarantee the information entered on the blockchain is reliable.
Nevertheless, there are promising solutions in the works. Circulor is a U.K.-based startup working on blockchain track and trace systems for industrial supply chains. It has a partnership with Mercedes-Benz for transparency of CO2 emissions in the cobalt supply chain, and received an investment from Volvo for cobalt traceability. Additionally, various industry leaders including Fiat Chrysler, Volkswagen, Volvo, and Ford are part of the Responsible Sourcing Blockchain Network (RSBN), which IBM founded. The consortium completed a successful pilot for tracking cobalt from Apple supplier Huayou’s Cobalt’s sites in the DRC.
Considering the value of Bluetech’s investment and Mutombo’s involvement with the DRC, we can expect meaningful developments in the mineral extraction business.