Anti-counterfeiting packaging is a growing market with a steady stream of funds being pumped into its research and development. Stepping into the Web3 era, it is redundant to say that blockchain-based systems present a lucrative and promising opportunity to ameliorate the functionality of anti-counterfeiting technology.
In this blog, we will explore the role of blockchain in expanding the applicability of anti-counterfeiting technology in security systems, supply chain management and customer engagement.
The trade of luxury products is rife with counterfeit. Upon analysis of both statistical and empirical data, the shortcomings of the manufacturing and distribution process included the inadequacy of information relayed to the consumers which renders them helpless in differentiating between originals and imitations. In 2017 alone, the total global loss of counterfeit products (including loss of brands, jobs, and consumers’ health and safety) was US $1.2 trillion. The luxury products industry accounts for 60–70% of all counterfeit transactions, far exceeding the values of the pharmaceutical and entertainment industries. [1]
The crucial features of anti-counterfeiting technology have been narrowed down to irreplicable, traceable and decentralized. Considering decentralized and blockchain are synonymous to many who have patchy knowledge about the later, it is only expected of experts to exploit the offerings of the shared database system.
Smart contract technology has been employed to curb data forgery and tampering. According to IBM, smart contracts are simply programs stored on a blockchain that are automatically executed when predetermined conditions are met.
To make processes more transparent for the consumers, information about the production, sales and raw materials needs to be conveyed to them.
Examples of optimal applications include cases in which product manufacturers and raw material suppliers reach an agreement on the supply of raw materials through smart contracts, or product manufacturers and product distributors reach an agreement on the sale of products through smart contracts. The use of such technology will ensure that consumers and third parties are able to trace the production and circulation history of products at any time.
