EV x Web3 has the potential to explode

The Biden Government has announced a policy to promote the widespread use of electric vehicles (EVs). This mandates that at least 50% of new vehicles manufactured in the USA must be EVs by 2030. This will lead to the development of new supply chains, assembly lines and manufacturing facilities in North America. This will be part of new regulations by the Environmental Protection Agency (EPA).

Blockchains can play an important role in ensuring supply chain transparency and human rights.

Car and battery manufacturers need a reliable way to ensure that they are sourcing raw materials according to proper procedures. At present, few such means exist. Batteries and automotive components are commonly sourced and assembled across multiple continents, from coal mines in Africa to factories in Asia to car assembly lines in Europe.

In the process of getting manufactured vehicles onto US roads, even manufacturers receiving federal incentives can hide the origin of raw materials or use unclean energy.

Complex and non-transparent supply chains are a major challenge for regulators seeking to ensure the implementation of sustainability initiatives and the establishment of end-to-end infrastructure in the US and Free Trade Agreement (FTA) countries.

Blockchain can help solve these challenges by providing a high degree of transparency and security for tracking and verifying the origin of raw materials and manufacturing processes.

Blockchain allows multiple parties to record and verify each transaction, from the mining of raw materials to production. This ensures the accuracy and reliability of information. This contributes to curbing smuggling and environmentally polluting mining and makes it difficult for companies to rely on ethically questionable sources. It also helps to address quality control issues, such as recent cases of electric vehicle ignition, and contributes to improved consumer safety.

Indeed, several organisations have incorporated blockchain into their supply chains and have demonstrated its effectiveness.

For example, global jewellery company De Beers is using blockchain to bring transparency to the diamond trade. This allows it to trace the route of diamonds from origin to market and ensure that the diamonds’ authentication information is protected.

The World Economic Forum (WEF) also aims to use blockchain to improve trust in the supply chain through its project ‘Redesigning Trust with Blockchain in the Supply Chain’. The project is working with over 100 partner organisations to streamline the implementation of blockchain by co-designing an open-source toolkit.

These projects are an inspiration for companies working to build EV supply chains. It is important for companies receiving preferential treatment from the US to verify that they are using clean and renewable energy and are taking environmentally friendly initiatives in the sourcing of raw materials. Blockchain could also be useful in quality control and safety during the manufacturing process.

These initiatives are an important step towards achieving sustainability goals, such as protecting the environment and ensuring human rights, through increased transparency and trust in the supply chain.

Blockchains can play a role in improving transparency and trust in supply chains and other industries by establishing reliable data.

Blockchain is particularly important in industries where the lack of transparency in supply chains across multiple continents is a challenge. The trust achieved through blockchain prevents data tampering and forgery. The tokenisation process also allows shareholders and others to hold new digital assets, potentially creating new markets.

In the real estate industry, initiatives are underway to utilise smart contracts and blockchain to tokenise property purchases and property rights. Similarly, the EV industry can utilise blockchain to ensure ethical procurement within the supply chain.

Furthermore, the use of blockchain is shifting from speculative crypto assets to digital assets linked to real-world commodities. Stablecoin projects such as Paxos are backed by gold and other precious metals, and a similar trend could spread to raw materials such as lithium in the future. This will require reform of national and international supply chains.

The Biden Government’s announcement of a policy to promote EVs is an opportunity for blockchain-enabled supply chain reform. This is expected to promote ethical sourcing and transparency within the supply chain.

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