Preventing counterfeiting Luxury brands are increasingly relying on blockchain technology | 08.07.22

• Blockchain technology to protect luxury brands
• Digital Twins of design products create transparency in the supply chain
• Digital branding is useful outside the fashion industry

The recent cryptocurrency crash has shaken confidence in cryptocurrencies. However, the technology behind Bitcoin & Co. Safe and can help protect styling products.

Counterfeiting has always been a big problem for manufacturers of many luxury brands. According to CNN, luxury brands lost $98 billion due to counterfeiting in 2017. In 2020, German customs alone confiscated branded clothing worth about 29 million euros. In addition to financial losses, counterfeiting means damaging the image of luxury companies. So it’s no surprise that luxury brands are now looking for digital ways to protect their products.

Digital twins using blockchain technology

Blockchain technology can be one such technology as it is a digital ledger that cannot be tampered with. Every transaction is recorded on the blockchain. In 2021, luxury groups LVMH, Prada and Cartier joined the Aura Blockchain Consortium, with Mercedes-Benz recently joining as another founding member. It is a private, not-for-profit blockchain in which “digital twins” of branded products can be created to certify the authenticity of designer products. Using the blockchain, the luxury products of the current 20 brands are provided with a digital ID to ensure that they are genuine.


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Daniela Ott, general secretary of the Ora Blockchain Consortium, told CNN Business that the Ethereum-based technology offers “bank crypto” that is impossible to counterfeit. Digital certificates can be accessed via a website or app, which not only gives informed consumers information about authenticity but also about questions of sustainability and ethics. However, Daniela Ott also sees a limit here: the data is only as reliable as the person entering it. The blockchain only helps those brands that also have good relationships with their suppliers.

sustainable goals

On the homepage, you can read that Aura is an association of luxury companies for a “higher purpose,” a non-profit organization that invests in technologies to ensure transparency and trust in luxury brands of the future. The blockchain records not only authenticity and ownership, but also information about the product throughout the production cycle, such as the material, the origin of raw materials, the place and time of manufacture and the quantity of manufactured products. This ensures product authenticity, ownership and traceability and provides transparency in the supply chain.

Above all, sustainability is a concern of the Aura Blockchain Consortium, and it can be read in the Twitter message. That’s why they joined the SMI Fashion Task Force. According to the company, the power consumption of the Aura blockchain is much lower than that of the public blockchain.

future developments

Partner NFT collections, such as Prada’s new Ethereum-based “Timecapsule NFT Collection,” are also available on Twitter. Limited edition T-shirts and T-shirts in this “time capsule collection” have been sold since 2019 in collaboration with different artists like Zach Lieberman or Cassius Hearst, now every owner should get a matching NFT.

Aura’s first anniversary celebration in Paris revealed a new partner for the Ledger ecosystem, the world’s largest Web3 hardware wallet, along with new NFT products allowing individual brands to forgo their NFTs or create their own NFT offering.

Other well-known brands are already using blockchain platforms such as the public blockchain Arianee to verify their products. The fast-growing luxury flea market can benefit from digital certificates. Luxury products must be authenticated in many online marketplaces.

Moreover, information about a product on the blockchain can be expanded at will in the future, for example in connection with the maintenance or servicing of technical devices or cars, thus helping to better determine the value of the product.

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