ASSOCIATION INSIGHTS
BiTA: Blockchain, Electric Vehicles, and Ethically Sourced Minerals
W
e continue to be impressed by the growing number of real-world blockchain applications in the transportation and logistics space,
including CargoX’s bill-of-lading smart contract platform for maritime freight, which went fully operational in November.
One of the more intriguing projects we’ve learned about is a joint venture between Ford, IBM, Huayou Cobalt, and LG Chem that will ensure ethical sourcing in the mineral supply chain. Of particular concern is cobalt, a metal used intensively in common lithium-ion battery chemistries. The recent growth of the electric vehicle industry has more than doubled the price of the metal since 2016, even after the
widespread commodities sell off at the end of 2018.
The trouble with cobalt is that it is most commonly produced as a byproduct of copper mining, and the ‘copper belt’ in the Democratic Republic of the Congo accounts for more than half of the world’s cobalt production. The DRC’s long-term civil war has rendered the rule of law tenuous, and child laborers are commonly used in its mines to find hunks of cobalt and deliver them to Chinese traders. Not all cobalt comes from exploited West African laborers, of course, but even Panasonic, which supplies cathode powder for Tesla’s batteries, had to suspend its cobalt supplier because it could not determine how much of the metal came from Cuba, which would have been in violation of the American trade embargo.
Tech companies from Facebook to Google and Apple are under increasing scrutiny to clean up their ethics, whether the issue is data privacy or labor relations. Companies who build electronic devices reliant on lithium-ion batteries - including Tesla, but also electric scooter companies Bird and Lime, as well as manufacturers of smartphones and laptops—will be held accountable for how they source their raw materials.
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