Blockchain and Distributed Ledger Technologies (DLTs) in the Circular Economy: A New Era for Sustainable Business Practices

¹ Department of Management Studies, Saveetha Engineering College, Chennai, Tamil Nadu, India.
² FMS CMS Business School, Jain Deemed to be University, Bangalore, India.
* Corresponding author. Email: periasamyp@saveetha.ac.in (P.P.); dinesh.rao@cms.ac.in (D.N.)
Manuscript received March 20, 2025; accepted July 5, 2025; published September 24, 2025.

Abstract—The shift from a linear economy to a Circular Economy (CE) is crucial for achieving sustainability and reducing environmental impact. However, large-scale CE implementation faces challenges such as a lack of transparency, inefficient supply chain coordination, and the inability to track and verify material flows across multiple stakeholders. Blockchain and Distributed Ledger Technologies (DLTs) offer a potential solution by enabling immutable record-keeping, real-time traceability, and automated smart contracts, thereby enhancing accountability and fostering circular business models. This study examines the role of blockchain and DLTs in advancing the CE by analyzing their applications, benefits, and challenges. While previous research highlights the theoretical advantages of blockchain in CE, empirical evidence on real-world adoption, scalability, and regulatory constraints remains limited. This research aims to bridge this knowledge gap by evaluating blockchain’s potential to enhance supply chain transparency, optimize resource management, and enable decentralized data sharing. Furthermore, it explores the integration of blockchain with Artificial Intelligence (AI) and the Internet of Things (IoT) to improve predictive analytics and facilitate data-driven decision-making in CE systems. Findings indicate that blockchain-driven CE frameworks can improve resource efficiency, reduce waste, and incentivize sustainable practices. However, widespread adoption requires standardized regulations, cross- sector collaboration, and advancements in interoperability. By providing a comprehensive analysis of blockchain’s capabilities and limitations in CE applications, this study contributes to the discourse on technology-driven sustainability and offers insights for policymakers, businesses, and researchers seeking to implement circular economic models.

Keywords—linear economy, circular economy, blockchain

Cite: Periasamy P.  and Dinesh N., "Blockchain and Distributed Ledger Technologies (DLTs) in the Circular Economy: A New Era for Sustainable Business Practi," International Journal of Blockchain Technologies and Applications vol. 3, no. 2, pp. 114-121, 2025.

Copyright © 2025 by the authors. This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0)