Canada-based Convergence.tech launched a blockchain pilot for traceability in the Mongolian Cashmere supply chain. The company has partnered with the United Nations Development Programme (UNDP), and the trial is being run under the latter’s Sustainable Cashmere Project.
Cashmere, an anglicised word for Kashmir, is an age-old luxury fibre obtained from a specific breed of goats which are found in China, Kashmir, Mongolia and some parts of Nepal. Initially reserved for the royalty, modern consumerism has led to a thriving Cashmere fabric market.
However, the problem with fast fashion is the opaqueness of the supply chain. Most herders in Mongolia are nomads, who make up about a third of the population, and have little means to get value for their produce. Thus, herders have doubled their herds for money, leading to overgrazing in the region which is leading to desertification. Several luxury brands have already banned the sale of Cashmere.
Convergence, with its Ethereum-powered ‘Backbone’ solution, is bringing the Cashmere supply chain to blockchain. The goal is to create a sustainable system for the herders as well as consumers.
“The nomadic community is one of immense pride but one with a volatile and unstable income. Leveraging blockchain technology within the transformation of the cashmere industry can provide numerous benefits for Mongolian herders, buyers, and sellers alike,” said Chami Akmeemana, CEO, Convergence.tech.
The firm sent two of its executives to Mongolia to train the herders to use the blockchain system. Convergence developed an Android app, which enables farmers to register their Cashmere bales with location tagging. These bales, along with the packing slips, are attached with high-frequency RFID tags.
The solution then tracks the journey of these bales from the herders to a processing factory in Ulaanbaatar. Blockchain, as an immutable ledger, provides buyers with proof that the Cashmere was produced using sustainable practices. The company said the solution could be scaled to include other products and supply chains.
Toronto-based Convergence primarily focuses on blockchain and Digital ID solutions. It currently has projects running in 14 different cities across the globe. Previously, the firm developed a blockchain land registry system in the Indian state of Haryana.
Apart from the UNDP the firm counts as clients the Toronto Stock Exchange (TMX) and the governments of Ontario and Toronto.
Last year, ConsenSys, Microsoft and LVMH launched the AURA blockchain network to trace the history and authenticity of luxury goods. Another blockchain provenance firm, Everledger, is leveraging DNA tagging to prevent counterfeiting of luxury goods.