Introduction
The circular economy is reshaping how we make, use, and manage products. Instead of the linear “take, make, waste” model: Take raw materials from the Earth, make them into products, and throw them away as waste - a circular economy concerns itself with keeping materials in use for as long as possible. This approach reduces waste, saves resources, lowers costs for businesses and as we’ll cover may even pave the way for increasing profits.
The European Union is pushing this shift through its Circular Economy Action Plan. A key tool is the Digital Product Passport, which will make supply chains more transparent and traceable. These changes will affect industries from fashion to technology, forcing companies to rethink product design, logistics, and end-of-life management.
New and established technology worked to communicate with one another is central to this transition. On the software side decentralised ledger technology (DLT) built on sustainable, scalable algorithms like Hashgraph, with tokenisation of assets and even entire processes can track materials, prove product origin, and speed up transactions. This, combined with physical systems such as collection points, repair hubs, and recycling facilities, form the backbone of a truly circular infrastructure.
Not all products are the same. Materials like metals and plastics require different handling than finished goods such as electronics or furniture. Knowing these differences matters for decisions on recycling, refurbishing, or eventually disposal.
The future of the circular economy will not be purely digital or physical. It will be a hybrid model where software works with real-world infrastructure. To make this shift practical, businesses need accessible “ramps” that let them leverage their existing assets while adding new tools step by step. This flexible approach helps firms stay compliant, manage costs, and remain in control of their circular strategies.
This article explores how circular infrastructure, EU policy, digital technologies, logistics, and product design all connect. It shows why adopting a hybrid model offers the most realistic path forward and one that should be accessible to the largest of organisations and smallest of startups alike.
A circular economy cannot function without strong physical infrastructure. Collection points, sorting hubs, repair centres, and recycling plants form the backbone of circular systems. Without these assets, products and materials cannot return to use.
The Ellen MacArthur Foundation stresses that infrastructure must serve whole industries, not only individual companies (Ellen MacArthur Foundation, 2023). Shared systems cut costs, improve efficiency, and make circular practices easier for smaller firms to adopt.
The World Economic Forum highlights logistics as a key barrier (World Economic Forum, 2023). Many regions still lack facilities to support reuse and repair at scale. Expanding local collection and processing networks reduces transport costs and lowers emissions.
Infrastructure also needs to reflect the difference between materials and finished products. Metals and plastics often require specialised recycling plants, while electronics or furniture need repair or refurbishment centres. Creating separate pathways for materials and products increases recovery rates and reduces waste.
Investment in circular infrastructure is rising, but gaps remain. Cities and regions must design systems that connect physical assets with digital tracking tools. This integration ensures materials are not only collected but also traced, processed, and fed back into the market.
The European Union is driving change with its Circular Economy Action Plan. The plan aims to reduce waste, increase resource efficiency, and design products that last longer (European Commission, 2020).
A key tool is the Digital Product Passport (DPP). The passport will store data on a product’s origin, materials, repair options, and recycling pathways. This system will make supply chains more transparent and help consumers and businesses make informed choices (European Commission, 2023).
The DPP forms part of the Ecodesign for Sustainable Products Regulation (ESPR). The regulation sets requirements for durability, reusability, and energy efficiency. It also ensures that products sold in the EU meet circular standards (European Parliament, 2023).
Pilots for DPPs began in 2024. A phased rollout is expected between 2025 and 2030, with many industries required to comply by the end of the decade (Vogue Business, 2023). However, some sectors will face deadlines as early as 2026 (TechRadar, 2024).
Businesses need to act now. Preparing for DPPs means mapping product flows, setting up data systems, and building partnerships across the supply chain. Firms that adapt early will gain an advantage in compliance, trust, and market access.
Digital technologies are essential to scale the circular economy. Tools such as blockchain, and distributed ledger technologies (DLTs) improve traceability and trust across supply chains. They do this by recording data in real time and make it harder to lose or falsify information (UNIDO, 2025).
Tokenisation is another key tool. It creates digital tokens that represent physical products or materials. These tokens can speed up settlement, reduce costs, and make ownership transfers more transparent (ResearchGate, 2024).
Blockchain applications are already being tested in waste tracking, material passports, and product lifecycle management. Studies show they can improve efficiency at firm and supply chain level, but adoption remains limited (PMC, 2023).
Both blockchain and Hashgraph are both DLTs . Blockchain, introduced to much of the world through Bitcoin and later a whole host of other projects is a cryptographic system first was theorised over 30 years ago. However, it wasn’t until the late 2000s that individuals, in their homes or places of work possessed the computing power and network speeds to operate and contribute to a network and build the blocks of transactions that get added to a chain of blocks, which make up the ‘Blockchain’.
In the case of Bitcoin, individual machines cryptographically contribute to creating new blocks of transactions and get rewarded for their efforts, with Bitcoin. It was a seminal moment for the internet and birthed what we think of as Web3.
Fast forward 15 years and lots of new DLT projects are established, most of them still running on optimised versions of Blockchain, but another technology stands out. Created and championed by the team behind the Hedera, ‘Hashgraph’ is a DLT technology different to Blockchain which is also entirely open-source and can be leveraged on Hedera’s own public network or used within privately hosted networks.
Hashgraph is essentially an algorithm that does away with blocks and chains and instead concerns itself with one, single, fairly ordered record of transactions (ledger). It achieves this at a tiny fraction of the energy usage that Bitcoin and other blockchain networks require (Platt et al., 2021) and does so at a fraction of the cost. This is because network fees are fixed and tethered to the USD, meaning that solutions built on top of it can be predictably scaled like any other enterprise level technology. With a governing body of some of the world’s largest companies and institutions backing it, it’s set to become the enterprise DLT of choice.
It’s our thinking that only Hashgraph has the capacity, cost, scalability and sustainability factors to sustain the throughput that a solution such as a globalised DPP project will require.
Challenges remain. Many systems cannot yet work together. Regulations differ across markets, and there are still no universal standards for digital product tracking (arXiv, 2024). Overcoming these barriers will require collaboration between regulators, technology providers, and industries.
Despite these hurdles, digital technologies can help meet EU requirements such as the Digital Product Passport. Linking physical infrastructure with transparent digital records will allow businesses to prove compliance and build customer trust.
Logistics and Fulfilment in Circular Systems
Logistics and fulfilment are central to making the circular economy work. Traditional supply chains focus on moving products from factory to consumer. Circular systems must also bring goods back for repair, reuse, or recycling. This reverse flow requires new networks and smarter coordination (World Economic Forum, 2023).
Reverse logistics includes collection points, sorting centres, and specialist hubs for refurbishment or recycling. These facilities must link closely with transport networks to reduce delays and costs. Digital tools that track location and condition of products can optimise routes and improve recovery rates (McKinsey, 2022).
Well-designed fulfilment systems can cut waste, lower emissions, and create new revenue streams. For example, companies can capture value by reselling refurbished goods or harvesting raw materials from old products. These practices also build customer trust by showing commitment to sustainability.
Challenges remain significant. Many regions lack infrastructure for large-scale reverse logistics. Costs for collection and sorting can outweigh recovered value if systems are not efficient. Transporting products long distances for repair or recycling also increases emissions, reducing the environmental benefits (World Economic Forum, 2023).
To succeed, logistics providers, manufacturers, and policymakers must coordinate investments. Combining digital tracking with local processing hubs will reduce inefficiency and support wider adoption of circular practices.
Here’s Section 6: Materials vs Products – Upcycling, Disposal, Refurbishing, in UK English, with opportunities and challenges, SEO-focused, and inline citations:
A circular economy must treat materials and products differently. Materials such as metals, plastics, and textiles can often be recycled into raw inputs for new production. Products, like electronics or furniture, require repair, refurbishing, or remanufacturing before they can re-enter the market (Ellen MacArthur Foundation, 2023).
Material passports are emerging as a tool to support this process. They provide digital records of a material’s composition, origin, and reuse options. This information makes recycling more effective and reduces the loss of valuable resources (European Commission, 2013; Wikipedia, 2023).
Clear pathways for both materials and products create more value. For example, metals can be recycled almost endlessly without losing quality, while electronic devices may be refurbished and resold. By designing separate strategies, businesses can reduce waste and improve profit margins.
Challenges arise when products mix multiple materials or use complex components. Composite plastics, glued textiles, or tightly integrated electronics are harder to separate for recycling or repair. Without better design standards, these items often end up in waste streams rather than being reused (Ellen MacArthur Foundation, 2023).
To address these issues, firms need to design with end-of-life in mind. Simple disassembly, standardised parts, and transparent data will help keep both materials and products in circulation.
Here’s Section 7: Hybrid Model – Accessible Ramps for Organisations, in UK English, with opportunities and challenges, SEO-focused, and inline citations:
The future of the circular economy will be hybrid. Software platforms must work alongside physical infrastructure to create practical, scalable systems. This approach allows firms to connect digital product data with collection, repair, and recycling assets (Financial Times, 2023).
“Accessible ramps” describe ways for businesses to join the circular economy without replacing existing systems. Modular software, such as platforms for Digital Product Passports, can integrate with current supply chains. Physical infrastructure, like local repair hubs or recycling networks, can expand step by step (Forbes, 2023).
This hybrid model gives organisations more control. They can decide when and how to add digital tools or physical assets, while staying compliant with EU rules. It also reduces adoption costs, making circular practices more accessible for small and medium-sized businesses.
Challenges remain. Integration is not always simple. Linking legacy IT systems with new digital platforms can be complex and costly. Physical infrastructure also requires investment, and local conditions may limit available options (Financial Times, 2023).
To overcome these issues, firms should start small. Pilots that combine digital tracking with local refurbishment or recycling hubs can prove value before scaling. Partnerships with logistics providers, technology firms, and regulators will also help build a smoother path to adoption.
Several industries are already testing circular models. The fashion sector is a frontrunner. Brands are preparing for Digital Product Passports by building systems that track materials and prove product origin. This effort aims to improve transparency and help meet EU requirements (Vogue Business, 2023).
Technology companies are also under pressure. The EU’s first Ecodesign for Sustainable Products Regulation working plan makes Digital Product Passport compliance a priority. Firms must act quickly to adapt systems and processes before deadlines arrive (TechRadar, 2024).
There are positive signs. Some companies are piloting circular logistics that combine digital tracking with local refurbishment. Others are building partnerships with recyclers to capture more value from end-of-life products. These pilots prove that a hybrid model can reduce waste while creating new revenue streams (McKinsey, 2023).
Challenges remain. Pilots are often small and fragmented. Scaling them across industries and regions is difficult. Many firms still lack access to the infrastructure or capital needed to expand. Without clear standards, companies risk building systems that cannot work together (TechRadar, 2024).
Despite these barriers, case studies show progress. Early movers are shaping the standards and building trust with customers. Their efforts highlight how collaboration and investment today can secure long-term advantage in a circular economy.
Here are some real-world examples that help show what circular economy strategies can look like in practice.
Madeby Planet Earth developed a Digital Product Passport (DPP) platform to enable item-level traceability. It helps fashion and textile firms track each item from production to reuse. The platform includes QRscannable IDs and AI analytics. Madeby aims to digitise one billion fashion items and double half their lifespans by 2030 (Madeby Planet Earth, 2024).
Kappahl, a Nordic fashion retailer, joined the Trace4Value project to pilot DPPs in textiles. Their models include sustainability data—like materials, eco-labelling, and recycling advice—for clothing sold online. These pilots help test how to present transparent data to consumers via QR codes (Kappahl, 2024).
Luxury brands are also issuing DPPs. Breitling uses Arianee’s platform to issue watch passports via QR codes. These link to product pages where owners can track repairs, extended warranties, and insurance services. The system promotes authenticity and after-sales engagement (Fashionbi, 2024).
Gucci and parent company Kering launched a Circular Hub in Tuscany. With €15 million in funding, the hub brings together suppliers, researchers, and manufacturers. It develops circular materials, recycling methods, and new local supply chains. It aims to strengthen Italy’s role in circular luxury (Vogue Business, 2023).
Nobody’s Child, a London-based label, began DPP pilots in 2023. The brand tracks around 110 data points per garment, tracing materials back to raw origin (Tier 5). Early results show deeper insight into sustainability, though data collection and supplier coordination remain challenges (Vogue Business, 2025).
Challenges persist. Many pilots remain small scale and resource intensive. Scaling them requires investment, standards alignment, and interoperable systems across sectors. Without coordination, fragmentation may slow broader adoption of circular models.
Nevertheless, these case studies highlight the power of innovation. Brands investing early in DPPs and circular labs are building trust, improving transparency, and setting industry benchmarks.
Here’s Section 9: Roadmap to Adoption, in UK English, concise, SEO-focused, with opportunities and challenges, and inline linked citations:
Moving towards a circular economy requires clear steps. Businesses should begin by auditing current systems. Mapping product and material flows identifies where reuse, repair, or recycling can create value (European Investment Bank, 2020).
The next step is to test Digital Product Passports. Pilots can track product origin, composition, and end-of-life options. Early pilots reduce risk and build experience before EU deadlines take effect (Ellen MacArthur Foundation, 2023).
Once pilots prove value, firms can expand. Scaling requires adding logistics for reverse flows, investing in refurbishment hubs, and linking these assets with digital systems. Tokenisation and blockchain can add extra trust and efficiency as systems grow (UNIDO, 2025).
Challenges often come from legacy systems and siloed operations. Integrating new digital tools with existing IT can be complex. Costs for upgrading physical infrastructure are also high, and funding is not always accessible (European Investment Bank, 2020).
Partnerships can ease these barriers. Working with logistics providers, recyclers, and digital technology firms spreads costs and speeds adoption. Support from financial institutions and regulators can further lower risks and encourage innovation.
A phased roadmap, tested through pilots, reduces disruption and builds confidence. Firms that adopt early gain compliance, strengthen customer trust, and create long-term competitive advantage.
The circular economy is moving from vision to practice. Success depends on linking digital tools with physical infrastructure so that products and materials stay in use.
The EU’s Circular Economy Action Plan and Digital Product Passports will accelerate this shift. Companies that prepare early can gain compliance, efficiency, and customer trust.
Technologies such as Hashgraph, and methods of tokenisation offer new ways to track and prove value. At the same time, investment in logistics, repair hubs, and recycling facilities ensures that products can return to the market.
Challenges remain, from high costs to fragmented standards. Yet firms that act now can shape the rules, influence innovation, and build lasting advantage.
The future will be hybrid. Businesses that combine software with accessible ramps to link physical systems, will lead the way in a circular economy.