JD.com, China’s second-biggest e-commerce player, is working on a traceability system based on blockchain technology. Yang Haiming, the digital architect behind the JD CTO system, made the announcement on Tuesday at the Beijing-hosted IDC CXO conference on digital trends. Haiming said that over 30 brand owners would take part in creating the system.
JD.com, also referred to as Jingdong and previously known as 360buy, is a major rival of Jack Ma’s Alibaba Group. As of today, JD is a global leader in AI and high tech delivery systems employing drones and robots. The company is the largest retailer in China.
The goal of JD’s blockchain-based supply chain system is to allow clients to check where the materials for particular products come from, the place and time of processing, storage, trade, and delivery.
Among the 30-plus partners are beef brand Kerchin and nutrition brand Wyeth, Yang said.
He also revealed that luxury goods companies were especially interested in this kind of traceability system given the number of luxury products traded on the Internet and customers’ desire to establish authenticity. The project is also of particular interest to fresh produce suppliers. He added that these companies would be ready to handle the high cost of building such a platform.
Yang told chinadaily.com.cn:
“Whole-process traceability is not a new concept but blockchain makes it really possible.”
On Monday, IDC China unveiled ten future trends for the internet and communications industry, one of the predictions referring to the distributed ledger technology (DLT) whose commercialization is expected by 2021. Wu Lianfeng, VP of IDC China, stated that about 25% of the largest 2,000 companies would use blockchain, while the DLT adoption rate in China might be 20% by that time.
JD.com reported earlier this week some record figures for its third quarter. Revenue jumped by 39% to the equivalent of $12.6 billion. The company’s net income was $200 million, which is its highest quarterly profit ever. JD’s annual active customer accounts rose by 34% to 266.3 million from 198.7 million the previous year.
Soon after the results went public, JD’s share price climbed by more than 5%.
Chairman and CEO Richard Liu commented on the results: “We are achieving our mission of bringing China’s consumers the widest selection of top brands and, by far, the highest quality e-commerce experience.”
JD’s rival Alibaba does not want to lag behind on blockchain innovations. Its subsidiary Ant Financial will use blockchain and smart contracts to facilitate rental property management.