The circular economy is the future for our market and planet. But to implement the concept of circular economy in life, we lack a resource of trust to build strong business relationships. Blockchain can become a source of mutual trust and the basis for a circular economy.
The overproduction crisis, the lack of recycling, pollution, CO2 emissions, and other circumstances accompanying the global economy led the world to disaster. To make the future of humanity positive, the economy must soon become circular.
Circular economics means using technology and design to use resources effectively and connecting the production-consumption-waste line in a circle through the recycling and reuse steps. The concept of a circular economy has great potential for overcoming the crisis of the recent economic model. However, there are some obstacles to this concept.
One of the components of the circular economy is sustainable production and efficient consumption of resources, reprofiling, and processing of products. But this part, which looks like the basic, cannot exist without another. Consumers should be assured that purchased green or recycled products are green or recycled. Without this trust and transparency, there will be no separation for the circular economy and linear, leading to a pullback.
show blockchain technology as one possible critical solution to overcome the lack of traceability and trust, which can build transparency
and improve track of every step of the supply chain.
Blockchain is a distributed ledger that does not need intermediaries to carry and verify transactions. Transactions and related data are saved in different nodes and protected from changes. Blockchain architecture adds value to the circular economy by providing evidence of the source and the way of the goods.
To implement sustainable production methods, transparency is needed that drives trust in products and companies. Improving the transparency of the source of products will stimulate eco-minded consumer behavior and changing corporate sources and processes to more sustainable.
Traceability and trusted data recorded in the blockchain contribute to sustainable resource management, waste reduction, and recycling. By providing a single source of trust, blockchain reduces transaction costs, improves productivity and communication in the supply chain, and reduces carbon footprint.
Consumers are increasingly demanding products produced ethically and environmentally friendly. Blockchain not only gives them confidence in the origin of products but also becomes a base for reward systems for circular purchases and eco-minded behavior. It adds motivation to protect nature.
Blockchain can be a distributed database for storing data on natural resources supervising, making their value more visible and creating new rules for natural resource trading. This is particularly significant for global supply chains, where there is often discussion about data sharing. The digital space of the distributed ledger will become a place of neutrality for transnational cooperative consumption and processing of resources.
To solve data quality issues, the distributed ledger is connected with IoT or RFID tagging systems. This automatic association to the real world advances real-time tracking. These systems require flexible and scalable blockchain architecture. FCE Group has developed a version of the combined blockchain for supply chain management, which collects the benefits of a private and public blockchain while saving energy
to maintain the network. FCE blockchain
is available for use by several companies at the same time. To make this use more convenient, the company is developing a new project, TransparenTerra
Thus, different circular projects can be combined into an advanced ecosystem, with guarantees of product quality and active motivation. Environmental production, green marketing, and conscious consumption are new realities that are already changing the rules of the game for people, businesses, and society. Brands and consumers together will cause a shift in the tracking and internal processes of supply chains. Blockchain will be one of the key technologies behind the changes, setting in motion a new way of thinking and lifestyle.