Blockchain spent several years as the answer to every question, regardless of whether the question made sense. Supply chain was frequently mentioned as a perfect use case—immutable records of product journeys, transparent provenance, trustless verification. The hype was considerable.

Now, as the hype has subsided, something interesting is happening. Genuine applications are emerging, not as revolutionary replacements for existing systems, but as solutions to specific problems where blockchain's unique properties actually matter.

The Provenance Problem

Some products really need to prove where they came from. Not as a nice-to-have, but as a commercial or regulatory necessity.

Diamonds are the classic example. Conflict diamonds—stones mined in war zones and sold to fund violence—have plagued the industry for decades. The Kimberley Process was supposed to stop them, but paper certificates can be forged, and the chain of custody from mine to jeweller involves multiple handovers where fraud can occur.

Pharmaceuticals face similar challenges. Counterfeit drugs kill people. Regulators increasingly require serialisation and traceability throughout distribution. But how do you prove that the pills in a box are genuine when they've passed through multiple distributors across multiple countries?

High-value food products need authenticity assurance. Is that whisky really from that distillery? Is that olive oil actually extra virgin from the region claimed? Food fraud is a multi-billion pound problem, and consumers are increasingly sceptical of claims they can't verify.

In each case, the problem isn't lack of records. It's lack of trust in records. Paper documentation can be falsified. Centralised databases can be altered. The question is how to create records that everyone can trust because no single party controls them.

What Blockchain Actually Provides

Blockchain's fundamental property is immutability. Once data is recorded on a blockchain, it cannot be changed without detection. This creates an audit trail that is mathematically verifiable, not dependent on trust in any particular institution.

This matters when you have supply chains crossing multiple organisations, jurisdictions, and trust boundaries. No single party controls the record. Every party can verify it. Tampering is evident.

The distributed nature eliminates single points of failure and control. There's no database administrator who could alter records. There's no central system whose compromise would undermine the entire chain of evidence.

Smart contracts—code that executes automatically when conditions are met—add another layer. Payment can release automatically when goods are confirmed received. Quality certificates can transfer with ownership. Compliance requirements can be verified without manual intervention.

The Expensive Reality

Here's the uncomfortable truth: blockchain is expensive. Running distributed consensus across multiple nodes costs more than running a central database. Transaction throughput is limited. Energy consumption, for some blockchain architectures, is substantial.

This expense means blockchain only makes sense when the cost is justified by the value. For most supply chain applications, a well-designed traditional database is cheaper, faster, and perfectly adequate.

The calculation changes when trust is genuinely contested, when the consequences of fraud are severe, or when regulatory requirements mandate specific levels of assurance. Diamonds, pharmaceuticals, premium food products—these categories can absorb the cost because the alternative is worse.

For routine procurement—office supplies, standard components, commodity materials—blockchain is overkill. The provenance question isn't contested. The fraud risk doesn't justify the investment. Traditional documentation is sufficient.

Smart implementation focuses blockchain where it adds unique value rather than applying it universally because it's fashionable.

Real Implementations

Several supply chain blockchain implementations have moved beyond pilot to production, offering lessons about what works.

De Beers' Tracr platform tracks diamonds from mine to retailer. Each stone is registered when extracted, with characteristics and ownership transfers recorded as it moves through cutting, polishing, and trading. Retailers can provide customers with verified provenance—a selling point for consumers concerned about ethical sourcing.

The pharmaceutical industry has adopted blockchain for drug traceability. The EU Falsified Medicines Directive requires serialisation and verification throughout distribution. Blockchain-based systems provide the audit trail regulators demand while enabling efficient verification at each handover.

Food traceability implementations are multiplying. Walmart famously traced mangoes from store shelf to farm in 2.2 seconds using blockchain, compared to nearly seven days with traditional methods. In food safety emergencies, that speed difference could prevent illness and save lives.

These implementations share common characteristics. They address high-stakes provenance questions where trust matters. They involve multiple parties who benefit from shared verification. They justify investment through reduced fraud, regulatory compliance, or premium pricing.

The Premium Brand Angle

For some brands, blockchain-verified provenance is itself a selling point. Consumers willing to pay premium prices for premium products also value authenticity assurance.

Luxury goods are exploring this space. A handbag with blockchain-verified provenance is demonstrably genuine, maintaining resale value and protecting brand reputation. The technology becomes part of the value proposition.

Organic and sustainable products benefit similarly. Claims about farming practices, environmental standards, and ethical production become verifiable rather than aspirational. Consumers can trust because they can verify.

Wine and spirits with blockchain traceability can prove region, vintage, and chain of custody. In a market plagued by counterfeiting—an estimated 20% of global wine sales are thought to be fake—verified authenticity commands premium pricing.

The economics here are different from cost-focused supply chains. The question isn't whether blockchain is cheaper than alternatives, but whether the trust and authenticity it provides justify price premiums that exceed its cost.

The Implementation Challenges

Successful blockchain implementation requires overcoming several non-trivial challenges.

The garbage-in problem persists. Blockchain guarantees that records can't be changed after entry, but it can't guarantee that initial entries are accurate. If someone registers a fake diamond as genuine at the source, the blockchain faithfully records that falsehood. Physical-digital linkage remains essential and difficult.

Consortium governance is complex. Supply chain blockchains typically involve multiple participating organisations. Agreeing on rules, standards, data formats, and governance requires coordination that doesn't happen automatically. Many pilots have foundered on governance disputes rather than technical challenges.

Integration with existing systems is non-trivial. Blockchain doesn't replace ERP systems, warehouse management, or logistics platforms. It adds a layer that must integrate with existing infrastructure. That integration work is often more challenging than the blockchain implementation itself.

Scalability limits constrain some architectures. Supply chains generate high transaction volumes. Not all blockchain platforms can handle industrial-scale throughput without compromising on decentralisation or speed.

The Honest Assessment

Blockchain for supply chain transparency is neither revolutionary nor useless. It's a specific tool for specific problems, valuable where its unique properties matter and expensive where they don't.

The hype cycle has passed. What remains is pragmatic adoption in domains where provenance genuinely matters, where trust spans organisational boundaries, and where the cost is justified by the stakes.

For most procurement professionals, blockchain isn't an immediate priority. For those managing supply chains of high-value, high-risk, or highly regulated products, it deserves serious evaluation. The technology has matured. Real implementations exist. The question is whether your specific situation makes the investment worthwhile.