Blockchain and the circular economy: potential tensions and critical reflections from practice

TLDR

Blockchain technology and the circular economy are emerging concepts poised to reshape industry under Industry 4.0, but their broad scope and potential tensions with applications warrant nuanced investigation. This paper examines how blockchain technology is likely to transform and advance circular economy realisation. Using grounded theory and multiple case studies across diverse industrial sectors, the authors map blockchain applications to the ReSOLVE dimensions of the circular economy and systematically analyze practices, gaps, tensions, and reflections. The study concludes with research propositions, acknowledges limitations, and outlines future research directions.

Abstract

Blockchain technology and the circular economy (CE) are two emergent concepts that can change the way we live for decades. Arrival of Industry 4.0 is set to transform organisational activities through various technological innovations. Blockchain is such a critical technology. Yet, the breadth of the blockchain concept and its application require nuanced investigation in different contexts, including examining some tensions with the applications. This paper examines how blockchain technology is likely to transform and advance circular economy realisation. Using grounded theory building from multiple case studies, we present early evidence linking the blockchain application to circular economy dimensions of regenerate, share, optimise, loop, virtualise, and exchange (ReSOLVE model). Case studies of blockchain application in various industrial sectors, at different adoption levels, for diverse organisational purposes are analysed and discussed. We systematically examine the practices, gaps, potential tensions, and critical reflections. Our study concludes with a summary of research propositions, limitations, and future research directions.