Chronicled Uses The Blockchain To Fight Counterfeiting

Blockchain & Supply Chain : Real Life Use Cases #2

Chronicled is a company specialized in the blockchain and the Internet of Things (IoT) technologies, to develop personalized solutions for brands in different use cases as ‘authentification, e-commerce, provenance, supply chain, and finance’. This case study discloses how Chronicled used the blockchain to prevent counterfeited sneakers.

1. The problem

The counterfeit sneakers market represents $240 billions. It appears as 40% of the ‘global counterfeit fashion market’ and a loss of €26,3 billions in sales every year, only in the European footwear market (Chronicled, 2016). If Coco Channel considered counterfeiting as a mean to measure brand’s success, nowadays, the reproduction skills of counterfeiters have improved. Counterfeited products appear very close to genuine products and consumers have difficulties to differentiate a true branded product from a false one, enhancing their uncertainties about the brand and diluting its image. Counterfeiting remains hard to tackle as the legal terms of intellectual property remain very subjective and differ between countries .

2. The solution

Using the NFC technology (Near Field Communication, operating through wireless activation) Chronicled inserted smalls identity inlays directly in the sneaker. Each of those inlay contains a unique, unforgeable and inimitable ‘cryptographic microchip’ digitally linked to the blockchain.

The experience of an authentic sneaker on smartphone:

Source: Chronicled, Sneakers Case Study, 2016

If Chonicled uses the Blockchain as a tool to counteract counterfeiting, the process of traceability remains superficial as it only begins when the shoes has been produced, reducing the dialogue between just two participants of the supply chain: the retailer and its consumers.