To tame the beast of counterfeit, let’s summon the weapon of NFC, AI or blockchain

It is said the global counterfeit industry is a USD460 billion business. And needless to say, China is often the epicenter of this lucrative yet illegal trade. But waves of technology have always been developing rapidly, hoping to bring the beast of ‘counterfeit” to its knees.

Several years ago, the technology about anti-counterfeit was more or less about NFC (Near Field Communication). NFC works by allowing two devices to communicate when they are in close range. It enables information to be exchanged between two NFC chips – one contained in the NFC smartphone and the other in the item. With 1.9 smartphones expected to be NFC enabled by 2018, some companies have been exploring its value in authentication solution simply by integrating NFC tags into the products. Here come few examples we noticed. 

In 2015, Cognac brand Rémy Martin launched an NFC-enabled bottle in China in partnership with company Selinko. 


2016, Maria&Donato, a premium leather goods brand based in Spain, collaborated with company ThinFilm by inserting NFC tags into one of their handbag collections to battle knockoff. ThinFilm clients also include brand like iolive from the olive oil industry.


Then starting in 2015, a new fascination has been surrounding the blockchain technology to combat the fake&fraud. The decentralized principle of blockchain suggests a digital ID can be created for a product by a federated consensus, which is immutable to any kind of tampering. The solution can help the organizations to trace the identity of the product in real time, eliminating the possibility of fraud. We saw London based startup Everledger applied the technology to the diamond registry. It has digitized more than a million diamonds and partnered with firms including Barclays. It is now expanding the product scope to other luxury categories, such as fine wine.


Another hotshot in the media is again a London based startup Provenance. It raised USD800K just in this month. Provenance aims at improving the retail and supply chain transparency. In 2016 Provenance completed a six-month trial tracking tuna fish caught in Indonesia by chronicling the product’s ownership and tracking product journey enshrined in the blockchain system.


Interestingly those blockchain anti-counterfeit startups are usually originated from London. We detected another one called Blockverify, also established in 2015. It uses blockchain to authenticate a wide range of high-value goods to simplify sales tracking and product verification.


In China, a noticeable company combining both NFC&blockchain technology is Vechain, a subsidiary of a Chinese company BitSE. It was launched in November 2016, an enterprise software designed to create, manage, maintain and update shared data about products in the supply chain. In 2016 Shanghai’s Fashion Week, VeChain teamed up with independent fashion label Babyghost to put fashion on the blockchain.


Entering into 2017, Artificial Intelligence came onto the stage as well. In July, New York based Entrupy, a hardware-enabled SaaS company with artificial intelligence-based technology for authenticating high-end luxury goods, announced that they have secured USD2.6 million in series A funding. Launched in 2016, Entrupy‘s patented technology is claimed to be used by hundreds of secondary retailers and marketplaces to authenticate handbags and wallets from brands including Louis Vuitton, Chanel. See video demo below for yourself.


Another interesting startup is Cypheme, which provides an AI powered system capable of recognizing the printed product’s packaging marker with a neural network, using only a cell phone camera. The Cypheme technology would allow a fast and easy way, accessible to anyone, anywhere, to verify the authenticity of the products adopting the solution. It is currently in strategic partnership with a leading European packaging company AR Packaging.


In many ways, we see the sector of anti-counterfeit technology has buoyed up in recent years and consider it should have great potentials to grow.

Author: Cecilia Wu