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The African Diamond Council (ADC) has made traceability its foremost priority and has been contributing to a traceability solution called Authentia.io for the last three and a half years, which is now ready to globally satisfy the traceability needs of the entire gemstone industry.
The council established a long-term cooperation agreement with Authentia.io, founded by proprietor Bruno Scarselli.
Authentia.io, designed specifically for African diamond-producing countries, offers a comprehensive approach, including certificates of origin, blockchain-based tracking, nano tagging, and titles of ownership, which aims to provide a more transparent and accountable system for the diamond industry.
ADC chairperson Dr M’zée Fula Ngenge recently told Rough & Polished’s Mathew Nyaungwa on the sidelines of the Dubai Diamond Conference in the United Arab Emirates that Authentia.io has been prioritised by African diamond-producing countries, as it empowers them to control their destiny and showcase the true origin of diamonds, rather than having the diamond journey narrative dominated by retailers.
While other blockchain-based technologies such as Tracr have also emerged, Dr Ngenge believes Authentia.io is the undisputed champion of traceability and is being adopted as well as reproduced by the entire industry.
He said the ADC would like to see the Kimberley Process Certification Scheme (KPCS), Group of Seven (G7), United Nations (UN), European Union (EU) and African Union (AU) collectively embrace Authentia.io and benefit from its all-inclusive advancements.
Below are excerpts from the interview.
How is ADC embracing traceability?
Traceability now has become the African Diamond Council’s preeminent priority, particularly in 2024 and we have been working diligently with an innovative traceability solution for the last three and a half years. We have been guarded about the relationship, the development and the research of this particular platform, given that we were patient enough to unveil when we felt we had an indisputable solution that we could offer to the entire global diamond industry.
What was never expected and what was important for the Authentia.io team is that no one in the industry would ever expect African diamond-producing countries to contribute to such a forward-thinking and comprehensive solution for the KP, G7, EU or even the Dubai Multi Commodities Centre (DMCC).
Bruno Scarselli is the founder of Authentia.io and is a third-generation jeweller based in the United States. After three years, this veteran diamond industry professional began to recognise the challenges that Africa faced. He demonstrated a rare and elevated level of understanding regarding how dissimilar diamond retail and mining are.
In the midst of that, he was determined to leave a legacy by developing and producing a progressive traceability solution that made Africa the top priority, since African diamond-producing nations represented eight of the top 10 and given that most of the traceability challenges can be attributed to the African continent.
Mr Scarselli also worked hard to build a platform and develop a solution that would restore the lost credibility that the Kimberley Process Certification Scheme for diamonds has suffered from since its existence. All of the criticism that the Kimberley Process (KP) has been subjected to was courageously addressed with the development and emergence of Authentia.io.
When was Authentia.io launched?
Authentia.io has been available to miners for the last 14 months. It was publicly rolled out at the "Provenance, Traceability, and Technology in the Diamond Industry," forum in Dubai, where several blockchain technologies were featured in May 2024.
It is vital to have distinguishable and concise terminology when defining Authentia.io because it cannot be designated or limited to wearing the mere title of "blockchain technology". The global diamond industry has already given in by designating Authentia.io as an advanced “traceability solution” which impressively gives prominence to four distinctive prongs.
What are these four prongs?
The first of four prongs exhibits unanticipated foresight by introducing "Certificates of Origin" to the industry. This is the world's very first entity to usher in certificates of origin, not only for the diamond but also for the entire gemstone industry.
The industry saw Tracr, De Beers’ Internet of Value (IoV) platform immediately embrace Authentia.io’s language and terminology, only to incorporate it into their storytelling chronicle. While De Beers has been known to simulate industry advancements such as Everledger, their immediate infringement on Authentia.io advancements serves as the ultimate compliment for an advanced traceability solution such as Authentia.io.
The second stage features a diamond scanning process, where rough natural diamonds are uploaded into a PUBLIC blockchain platform at the mining site. Utilisation of the world’s only public blockchain for diamonds is also compatible with existing PRIVATE blockchain technologies. During development, Authentia wanted to ensure that the solution being developed could also co-exist with the unavailing private blockchains that were featured during Dubai’s Provenance, Traceability, and Technology forum in May 2024.
The third step offers the "nano-tagging" process of diamonds (above and below the surface) for both rough or polished. Since Authentia.io owns the patents for the smartphone lens technology, it is in a position to identify those diamonds that have been nano-tagged.
The last prong is highlighted by a "Title of Ownership", which should accompany all gem-quality diamonds over 1 carat, particularly since diamonds fall into a similar acquisition category such as real estate and vehicles, which are purchases that take place at least once in a lifetime when the consumer has favourable financial conditions. When the diamond is paid in full, the title should be handed over and accompany any new transfers or ownership.
Each of these propositions was an attractive and necessary step to take in the eyes of African diamond-producing countries. While the Authentia.io traceability solution is ideal for African diamond-producing countries, it does exclude diamonds being produced by the Russian Federation, for example, given that the industry needs an effective mechanism to identify production, irrespective of where it is extracted or produced.
For more than two years, so much energy has been put into preventing Russian diamonds from entering the market and little or no effort or energy has been put into actually putting an end to the Russia-Ukraine war. The global diamond industry needs Russian diamonds back on the market and there will come a time shortly when the industry moves to accept, embrace and reintroduce Russian goods.
Why?
Let us carefully assess the current situation that the global diamond industry is experiencing at this present time. The market is rather soft and prices continue to drop, while synthetic diamonds are becoming the preferred choice for diamond consumers with strict budgets.
When a nation is considered the world's top natural diamond producer, that producing nation should never be left on the sideline to control their destiny when under sanctions, because there will be a way to survive or overcome those embargoes.
Many observers would conclude that what is bad for Alrosa or the Russian Federation is good for African diamond-producing nations. While the sanctions on Russia put Africa in a position to produce more, the blessing can easily turn into a curse, so we must not forget that it was Russia who bet on Angola when no one else would.
Alrosa can take credit for delivering the level of positive attention Angola is receiving today. When Russian diamonds are excluded from the world market, defenceless loopholes are masterfully exploited and escape routes for Russian diamonds can be traced and led to the United Arab Emirates as well as in the People’s Republic of China and the Republic of India.
Before the Russian sanctions, we can look at Surat, India's once thriving diamond city as a case study. Surat was dependent on Russian diamonds to sustain its diamond centre, however, when Russian diamonds are banned or removed, a moment arrives when uncertified Russian diamonds start to become very attractive or even a necessity, especially if those diamond supplies persist in keeping cutting and polishing operations afloat during these challenging times. Kimberly Process (KP) certified or not, thriving Diamantaires within major diamond centres will eagerly continue to consume them. No one wants to see cutting and polishing factories close down. It is difficult to control the market and maintain optimism in such situations.
What is unique about Authentia.io compared to other products on the market?
An important aspect to mention regarding Authentia.io is that the gemstone traceability solution can be applied to all precious and semi-precious gemstones that are cut and polished for jewellery or consumer consumption. Authentia.io possesses the capacity to deliver the level of global credibility required to attract more members and remove many of the criticisms that KP has undergone since its declaration in 2002.
The diamond certification scheme is now 22 years old and Authentia.io has had success in furnishing more industry solutions in 22 months. Even the African Diamond Producers Association (ADPA) can take a page from the Authentia.io playbook. For the ADC, the African Diamond Manufacturers Association (ADMA) and the African International Diamond Exchange (AIDEX), it is about making sure that each entity possesses an effective mechanism and solution for the Kimberly Process (KP). I am not anti-KP, so I can constructively critique it as much as I want. At the same time, I feel obligated to provide some sort of solution, if KP is ever going to be relevant.
What has been the level of interest in Authentia.io?
Getting mines involved, and interested and making them aware that they deserve more revenue or attention is what is making the diamond journey all worthwhile. Most consumers erroneously assume that the diamond journey starts with the jeweller. When a piece of diamond jewellery receives compliments, many refer to highlight jewellery brands, such as Tiffany, Chopard, Graff, etcetera.
With Authentia.io now issuing certificates of origin, there is a much stronger interest to give the country and the mine credit for being the actual origin, rather than starting the diamond journey in the workshop of the jeweller. Consumers fail to realize or highlight the fact that their diamond could be from the Chitotolo mine in Angola or the Karowe mine in Botswana as an example.
Blockchain alone cannot solve the problems of African diamond-producing nations, so what is needed is a bona fide traceability solution that the entire gemstone trade. The ADC, ADMA and AIDEX have allowed all existing blockchains to present and prove their worth, however, Authentia.io proved to be the undisputed champion of traceability. For private blockchains to adopt Authentia’s language is confirmation that it exceeds the expectations of those who have desires to establish themselves as traceability pioneers.
What about the uptake by other gemstone producers apart from diamonds?
Other gemstone producers are paying close attention to how the diamond industry utilises Authentia.io and the demand is now running parallel to that of diamonds.
What was your role in the development of Authentia.io?
My role was to play devil's advocate in the testing phase and to determine if what Authentia.io was presenting could withstand the ADC's rigorous attention to detail and criticism from Africa's diamond-producing countries.
At the end of the day, the diamond mines get a great deal of satisfaction from keeping their business model simple, to extract and get paid for their production, nothing more.
The mines are beginning to come around to understand the long-term benefits of digitalisation and modernism, so I feel obligated to make the mines in Africa more aware of the benefits that they were passing up.
What measures were put in place to prevent technological duplication?
Patents, which are intended to reward inventions, have given Authentia.io a powerful layer of protection against those who are looking for an easy path to success. The patents obtained by Authentia.io are enhancing and increasing the company's valuation. Nonetheless, to avoid blocking innovation and slowing industry progress, Authentia.io’s patents will eventually become open source and free for anyone to use.
So how much does it cost to have this solution?
The prices will vary from country to country and the costs will not be felt by the mine, particularly since the benefit to generate additional revenue is the focus on modernisation and digitalisation of each mining operation. The benefits for the mine increase drastically when the KP and G7 exhibit the fortitude to adopt and implement Authentia.io’s traceability solution.
The Authentia.io traceability solution can even be applied as a white-label product for those who are utilising private blockchain technology, so there is no reason for private blockchains to say "no", they "cannot" or "will not" incorporate Authentia.io into their day-to-day operations.
I'm assuming you've already approached KP. What has been their response?
KP failed to incorporate Authentia.io during its “Year of Delivery” campaign, however, they will have another opportunity to come back before the Intersessional in 2025 to redeem themselves during their “Year of Best Practice” theme and demonstrate that they possess a clear understanding of the benefits to integrate the traceability solution next year. The ADC shall continue to utilise elevated levels of industry foresight, insight, and hindsight, so we can continue to be a little bit more authentic with our decision-making in the quest to restore industry credibility.
Mathew Nyaungwa, Editor-In-Chief, Rough & Polished
