Blockchain for Supply-Chain Transparency: From Hype to Evidence. What 10 Years of Blockchain Pilots taught us About Traceability and Sustainability

The promise we were sold

Looking back to the 2016–2018 era, Blockchain was the word on every supply-chain conference and the language around it was sweeping. The World Economic Forum described it as "immutability, security, speed and scalability" and as "ideal for traceability," capable of creating a visible and auditable trail that ensures full transparency to create an ecosystem of trust amongst stakeholders (WEF, 2018). From diamonds to cobalt and tantalum, blockchain was the new technological promise to supply chain challenges. The WEF report identified more than 65 ways blockchain could be applied to solve "the world's most-pressing environmental challenges,".

As Co-Founder of the Digital Social Innovation Lab at the University of Mannheim, together with Prof. Laura Marie Edinger-Schons, I organized sustainability hackathons at one of Germany’s leading business schools at the time. We facilitated numerous student-led social startups exploring blockchain-based solutions to supply-chain challenges, from tracing fish “bait to plate” to tracking food “farm to table.” With experts from SAP contributing technical expertise to the Lab, these experiences gave me an early, hands-on perspective on both the promise of blockchain for traceability and the practical limitations that emerge when technological solutions meet the social complexities of supply chain challenges.

In 2016, blockchain was rapidly moving from the world of cryptocurrencies into the mainstream. The World Economic Forum called it a potential “game changer” - including efforts to tackle fraud and corruption in the blood-diamond supply chain. McKinsey, more cautiously, was already questioning whether the enthusiasm was justified, noting that its unique value over conventional databases was unproven (McKinsey, 2017).

Ten years later, the honest question is: what did blockchain actually solve?

Blockchain and distributed ledger technology (DLT) do offer genuine advantages. They can create tamper-resistant transaction histories, provide timestamps and chain-of-custody records and enable organisations that do not fully trust one another to work from a shared record. They can attach provenance data to a specific batch or item, reduce the need to reconcile information across siloed databases and use smart contracts to automate routine processes. Perhaps most importantly, they can provide an auditable and persistent history of how records have changed over time.

But there is an important distinction between verifying a record and verifying the real-world claim behind that record. The World Economic Forum itself makes the crucial distinction particularly clear in its own technical work on the subject a couple of years later: blockchain can protect recorded provenance and traceability data from later modification, but organisations still need additional checks and balances to ensure the underlying data was accurate to begin with (WEF, "Inclusive Deployment of Blockchain for Supply Chains," 2019).

In other words: blockchain can protect the chain of evidence. It does not create the evidence. A friend working in corporate supply chains in the automotive industry once compared “blockchain-verified” traceability to accounting software. Just because a company uses software that helps it record and manage its accounts does not mean it no longer needs an audit. The same applies to blockchain: the technology can help create and preserve records, but that does not automatically verify the truth of the information behind them.

The Blockchain blind spot: Verifying the real world data

As my work now focuses on the gemstone and artisanal and small-scale mining (ASM) sector, let me bring this discussion into that context. Consider a typical gemstone supply chain: mine → trader → exporter → manufacturer → retailer → consumer.

Blockchain can reliably document movements between these actors, including timestamps, transfers of custody and certificates attached along the way. But it cannot independently establish whether the material actually came from the claimed mine, whether working conditions or environmental impacts were accurately reported, whether a supplier is who they claim to be, or whether the physical object genuinely corresponds to its digital identity.

If false information enters the system at the first node, blockchain will preserve it just as effectively as it preserves the truth. The danger arises when that immutability is then presented to consumers or stakeholders as “blockchain-verified,” lending credibility to information that may never have been independently verified in the first place. This is the classic “garbage in, garbage out” problem: a ledger can only be as trustworthy as the evidence and verification processes behind the real-world data.

The real lesson: transparency is an institutional problem

After ten years of experimentation, the limiting factor increasingly appears to lie less in database architecture and more in governance, standards, incentives, evidence, physical verification and stakeholder participation. In other words, many of the hardest supply chain challenges are not technological at all.

McKinsey raised this point early. In 2017, it argued that where supply-chain participants are known and trusted, a conventional centralised database may already provide an adequate and considerably cheaper solution. Blockchain becomes more compelling where participants do not know or fully trust one another. The irony is that these are often precisely the environments in which establishing reliable real-world data becomes most difficult.

The World Economic Forum has similarly acknowledged that blockchain is “prone to hype". A decade of experimentation points to a more nuanced conclusion: blockchain may help address the problem of trust between databases and organisations, but it does not eliminate the much harder challenge of establishing trust in the evidence entering those systems.

When "blockchain-verified" becomes greenwashing

"Blockchain-traced" is a technically defensible claim, it describes how records move, not what they mean. But consumers routinely read accompanying language like "ethical," "responsible," "sustainable," "conflict-free," or "responsibly sourced" as claims about the underlying production conditions. A blockchain record cannot independently establish any of that. It can only tell you that whatever was entered hasn't been altered since. This is where a technology argument turns into a consumer-protection and compliance question. What we see all too often is that time, money and resources that could be invested in strengthening underlying verification systems are instead directed towards “blockchain pilots” - offering a technological quick fix for a fundamentally much more complex problem.

New European legislation: EmpCo changes the context

Directive (EU) 2024/825 - the Empowering Consumers for the Green Transition Directive ("EmpCo") - gives this debate contemporary regulatory angle. Coming into effect from the 27 September 2026, it amends the EU's Unfair Commercial Practices Directive specifically to tackle greenwashing and "non-transparent and non-credible sustainability labels" (EUR-Lex, Directive (EU) 2024/825).

The EU’s Empowering Consumers for the Green Transition Directive (EmpCo) raises the bar considerably. Generic environmental claims such as “environmentally friendly,” “green” or similar claims are prohibited where recognised excellent environmental performance relevant to the claim cannot be demonstrated. The Directive also tightens the rules around sustainability labels: such labels must be based on a certification scheme with publicly available requirements and third-party monitoring, with the verifier’s competence and independence assured under defined procedures (Directive (EU) 2024/825, recitals 7–10).

Applied to claims such as “blockchain-verified,” this shifts the question away from the technology itself. A blockchain may demonstrate that a record has not been altered, but who established that the underlying claim was true? Who assessed the evidence, against which criteria, and with what degree of independence? A secure ledger is not a substitute for credible verification. In the emerging EU regulatory environment, the critical question is no longer simply whether the data can be trusted not to change, but whether the evidence behind the data can be trusted in the first place.

What the next generation of traceability could look like

A credible traceability system requires a broader architecture: physical evidence → independent verification → digital identity → traceability system → tamper-resistant ledger.

Blockchain can play an important role within this architecture, particularly as a tamper-resistant layer that helps ensure verified information cannot be altered after the fact. But it should not be mistaken for the architecture itself. Perhaps the next step is therefore a shift from “blockchain-based traceability” to “evidence-based traceability”, where blockchain is one component of a wider system built around credible evidence, independent verification and transparent communication, rather than a substitute for it.

After ten years of Blockchain supply-chain pilots, perhaps that is the most important lesson: Technology alone cannot resolve problems that are ultimately about evidence, governance, incentives and trust.

When we talk about supply-chain transparency in 2036, I hope we will no longer be impressed simply because a record sits on a blockchain. We need to ask deeper questions: Where did the evidence come from? Who verified it? Can we connect it to the physical product? And how can we trust the claim behind the data?

That is the challenge we are now exploring at Gem Trail Lab: connecting evidence from the mine, independent verification and digital traceability into systems that can carry trust from origin to consumer. The technology matters, but evidence must come first. If the last decade was about blockchain, perhaps the next could be about what we put on it.

About the author

Manuel Kreitmeir works at the intersection of sustainability, innovation and applied research. His professional experience includes work for the European Commission and Harvard University, as well as teaching in the Master’s programme in Sustainability and Impact Management at the Mannheim Business School. Since 2026, he has been leading an interdisciplinary team at Gem Trail Lab based in Colombo, Sri Lanka, facilitating collaborative research across the gemstone and artisanal and small-scale mining (ASM) sector, with a particular focus on sustainability, traceability, and innovation.