Mining3 and RMIT team up for blockchain breakthrough

A team at Mining3 and RMIT University have developed a new blockchain software platform which allows miners to trade on the future value of their unprocessed materials
Mining3 and RMIT team up for blockchain breakthrough Mining3 and RMIT team up for blockchain breakthrough Mining3 and RMIT team up for blockchain breakthrough Mining3 and RMIT team up for blockchain breakthrough Mining3 and RMIT team up for blockchain breakthrough

The team at Mining3 provided the mining 'know how'

Staff reporter

Julian Wise, a Software Engineer at Mining3 and RMIT student, said the software used financial algorithms along with transparent blockchain ‘smart contracts', to enable the trading of derivatives.
 
Derivatives are financial contracts where buyers agree to purchase an asset, in this case, unprocessed ore containing gold, on a specific date at a set price.
Unprocessed ore is often stockpiled if not profitable to process or extract at current market rates. But Wise said that fluctuations in commodity prices and advances in mining technology meant ore which was previously unprofitable often becomes profitable to process in the future.
 
"This simply harnesses that future value of unprocessed materials today to give miners immediate cash flow and royalties from their stockpiles, whilst enabling market traders to profit on future price increases," he said.
 
"But while people are already trading on the future value of processed metals and minerals, no-one has applied the same pricing mechanisms and exchange styles higher up the supply chain to unprocessed minerals."
 
The team's pioneering project was presented this week at the 3rd Symposium on Distributed Ledger Technology on Queensland's Gold Coast.
 
To develop the prototype software, RMIT University students worked with Australia's leading collaborative research and development group for the mining industry, Mining3, who had a vision for a next-generation blockchain-backed platform.
 
Mining3 senior mining researchers provided the mining industry context, technical detail and know-how on mineral price calculations while the RMIT Software Engineering and IT students developed the pricing algorithm, blockchain ecosystem and website interface.
 
Mining3 Chief Operating Officer, Susan Grandone, said the technology was built through interdisciplinary co-operation, with the solution combining mineral technologies and finance, deployed as a software service.
 
The technology is currently set up as a prototype on a demonstration website for internal use and testing. Another iteration of development is necessary to carry the proof of concept through to a platform that can be utilised in a production environment for real value transactions.