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Blockchain technology in the mining industry

Can miners achieve greater security and drive productivity through blockchain technology?

Cybersecurity has been a growing problem across industries, but it is especially troubling in mining. Since 2010, there have been major cyber attacks at 22 mining companies.1 Motivations for breaches have ranged from derailing an M&A transaction to stealing intellectual property and personal information.2

A 2016 report from the Symantec security firm highlights the mining sector’s risks.3 For example, mining ranks Number 1 among industries when it comes to receiving spam email. And about 1 in 3 industry emails will contain a virus. (See Figure 1.)

FIGURE 1

Figure 1

What can miners do? One answer lies in an emerging digital technology known as “blockchain.” Blockchain allows individuals to sign contracts electronically, without having to rely on a trusted third party—such as a bank—to verify the contract’s validity. That validation is handled automatically and electronically. Blockchain is a digital ledger that keeps a record of every transaction,4 and safely encrypts that information. And by eliminating the need for a middleman, it reduces the exposure of data to hackers. Financial services companies are already exploring the use of blockchain to automate and record transactions.5

Blockchain could add a new dimension of security for miners. But that’s not all. It could also help drive productivity improvements in areas such as:

FIGURE 2

Figure 2

Often, productivity and security are seen as conflicting demands in business. But blockchain technology offers the potential to improve both. And now is the time for miners to see how it can work for them.

Footnotes:
1Catalin Cimpanu, Mining Sector Has Faced 17 Major Cyber-Incidents in the Past Six Years, Softpedia.com, 29 June 2016. http://news.softpedia.com/news/mining-sector-faced-17-major-cyber-incidents-in-the-past-six-years-505783.shtml Factiva, Inc. All Rights Reserved (accessed 30 June 2016).
2Numaan Huq, Mining Companies Under Attack, Trend Micro, 28 June 2016. Factiva, Inc. All Rights Reserved (accessed 30 June 2016).
3Internet Security Threat Report, Symantec, Vol 21, April 2016. 
https://www.symantec.com/content/dam/symantec/docs/reports/istr-21-2016-en.pdf?aid=elq_&om_sem_kw=elq_16244209&om_ext_cid=biz_email_elq_&elqTrackId=283a3acdb3ff42f4a70ab5a9f236eb71&elqaid=2902&elqat=2
4Kendra Thompson, Being bold with blockchain, Accenture.com, 15 March 2016. http://fsblog.accenture.com/capital-markets/tag/blockchain/
5Anthony Di Iorio, The Blockchain Is Transforming Finance; A new way of doing business is here, National Post, 23 June 2016. Factiva, Inc. All Rights Reserved (accessed 30 June 2016).