Blockchain: as solution to counterfeiting in luxury industry by Valeria Boi



Luxury fashion has always attracted people, who are always willing to spend a large amount of money to own a luxury brand product, indeed this market is expected to grow annually by 7.28% (CAGR 2022-2027)*

The reasons for this are not surprising, because owning a luxury piece means feeling a sense of belonging to the brand and to be part of something prestigious and unique.

At first glance, some people consider the prices of luxury brands too high, because at the end “a bag is just a bag”, for instance. If consumers decide to buy it, it’s because that sense of uniqueness they feel owning that bag, encompasses a series of important things. Craftsmanship, high quality of materials, creativity, heritage, handmade, limited number of pieces. All these characteristics are the sign of the excellence of luxury, and many people aspire to be part of this exclusive world sharing the values of these brands.

Taking into consideration these factors, counterfeiting has found the way to make easy profit. Counterfeiting consists in the unauthorized replication of original products, sold at lower prices. The market most affected by this phenomenon is luxury fashion, damaged on it own profit and according to the Global Brand Counterfeiting Report** 2018-2020, luxury brands had losses of $30+ Billion.

Counterfeiting can be seen everywhere, fake products sold on the streets, in markets, multiple websites, and it has been going on for decades despite various attempts to stop it.

Sometimes consumers know that a product is counterfeit but they decide to buy it anyway because the price is low compared to the original; some instead buy not knowing that the product is not the original and they are deceived.

Nowadays counterfeit products are so identical to the original that it becomes difficult to distinguish them. This is a huge problem for luxury market in terms of loss of income and reputation. People may think that it’s so easy to produce and copy a luxury product and therefore it’s not worth buying them at high prices. Counterfeiting is not only illegal, but it means stealing ideas, damaging research work, belittling the handwork of professionals, destroying the meaning behind that product.

Technology, with Metaverse, NFT and DAO, has become an integral part of fashion and the Blockchain system seems to protect luxury from counterfeiting.

Blockchain is a digital ledger of transactions who is impossible to change, and it can register information that can’t be altered. It’s from the desire to protect their reputation and consumer purchases that the luxury brands LVMH, Prada Group, OTB, Cartier, part of Richemont and Mercedes-Benz have come together to found the Aura blockchain Consortium in 2021.


This non-profit association is financed by the founders and partly by the other members, and it’s open to all the luxury brands worldwide, and shows how is important for all the competitor brands fight the counterfeiting, verifying the authenticity and provenance of luxury goods.

With Blockchain technology customers can verify the authenticity of their purchase and they can trust the brand and its credibility: for every luxury piece they can check the material, where was made, when was produced, how many pieces of that product exist.


This year Aura Blockchain Consortium announced the collaboration with Temera, a company who supports Fashion and Luxury industry using IoT technologies like RFID (UHF, NFC) and Blockchain offering services as logistics and production processes, anti- counterfeiting and improving customer experience.

Two organizations that with their technology systems ensure transparency and traceability in the luxury market.

Creating a digital identity of luxury items has become a necessity and it’s also useful for resellers and second-hand luxury market. When a consumer intends to buy a pre-loved product, he tries to understand if that item is really the original, since counterfeiting is widespread. With the digital authentication every pre-loved luxury item is protected and officially verified, increasing consumer trust in both the brands and second-hand market, improving customers experience.


This collaboration between luxury and technology will intensify more and more in the future, and for the first time the Blockchain is the only system able to prevent counterfeiting. Everything evolves, changes, improves and this is what’s happening in the world of luxury together with technology.




** Globenewswire


Valeria Boi / London