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Bitcoin Technology To Combat Diamond Fraud

Avatar Guest Author 5 years ago

A relatively new fraud detection company Everledger is reportedly utilizing the Bitcoin technology to prevent insurance frauds. The London-based startup was one of the entrants at the recently concluded Barclays Accelerator event, which saw Bitcoin startup Safello partner with Barclays to co-create a Bitcoin platform.

Speaking to Techcrunch, Everledger’s Founder and CEO Leanne Kemp said, “The perfect use case for the blockchain is most definitely when there is an immutable ID on a device that cannot be changed and it is sitting within an immutable ledger. And that is clearly within the world of IoT (Internet of Things). Where you literally get the Intels of the world providing an immutable ID. And we see that, from an insurance perspective, coming down the line quite quickly.

How will they do it?

The fraud detection company will be focusing on 40 metadata points in addition to the 4Cs (color, cut, clarity and carat weight) which identify a diamond. The laboratory houses will then digitize a diamond on the basis of these parameters and Everledger will then take the digitized data and the serial number (inscribed on a diamond), and put it all on the Bitcoin transaction ledger blockchain. Blockchain, which is a public ledger, cannot be altered like paper bills and receipts, and thus can prevent frauds and false insurance claims. In London alone, diamond frauds account for $2 billion.

Why only Diamonds?

Even though the company is starting with diamonds, it has a bigger view of expanding into other luxury items as well. Luxury items such as watches, designer bags and expensive art items have been known to be most prone to duplication. Therefore, Everledger will be using the technology underpinning Bitcoin to spot counterfeit goods which have been hard to detect on online e-commerce stores such as eBay, Rakuten and others.

Everledger will also be releasing a digital vault app around September or October for owners of luxury goods.

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