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NFTs, RFIDs, & Authenticating Fashion

Connecting the Digital NFT to the Physical Goods

Counterfeit Goods Market

In the future, our view of ownership and authentication will change with the merging of NFTs and RFID chips (Radio-Frequency Identification). Why will these two technologies merge?  To prevent the production of counterfeit goods and protect both the seller and consumer.

The volume of counterfeit goods reached $1.2 trillion in 2017 and was expected to rise to $1.82 trillion in 2020 internationally.  Without a preventative force, these numbers are expected to keep on growing. Luxury brands are not happy about this and the consumer who purchases an expensive counterfeit also suffers.

Counterfeits are all over, even in the USA. Back in January 2021, U.S. Customs and Border Protection (CBP) officers in Minneapolis seized two shipments containing designer apparel worth more than $550,000.  As international trade and operations grow, the need for smarter authentication has never been so crucial.

Intorducing the RFID & NFT Marriage

The authentication of physical luxury goods with the digital world through NFTs is now a possible reality. The ability to track products, share accurate information and data with brands and consumers is essential to fighting counterfeit markets.

But how does one confirm the authenticity of the physical show when it is resold?

One way that luxury brands can eliminate counterfeits is by combining blockchain technology with RFID & Near Field Communication (NFC) technology which is a contactless solution based on a radio frequency field, designed to exchange data between two devices through a simple touch gesture. Radio-Frequency Identification (RFID) uses electromagnetic fields to identify and track tags attached to objects and can be easily embedded within most goods.  RFID chips can be very tiny.

Pairing a non-fungible token with a physical shoe, hat, or purse release and making it trackable across a blockchain with near-instant authentication using RFID/NFC technologies will help fight the war on counterfeit goods. Once a purchase is made with a registered seller, the buyer would receive a corresponding NFT that uses blockchain technology to verify authenticity and ownership. If the luxury goods are subsequently sold or traded again, the digital token follows the sale in the blockchain.  Proving authenticity will occur in both the physical and soon to be virtual worlds.

Increasing Brand Product Transparency

Combining RFID/NFC with blockchain solutions can lead to increased transparency between brands and consumers, more trust in owning authentic goods all through the use of smart contracts. NFC technology provides a safe connection to data about product origin, certifications, and the journey through the sales. These insights provide key benefits to all stakeholders, from suppliers to consumers.  The brands may even use location methods to be able to locate where their products are being resold similar to how apps on smartphones collect location data.

Blockchain & NFT technology stands to be a true game-changer within the fashion industry, with the capacity to enable consumers to prove authenticity and brands having the ability to trace and track sales.  The authenticity and quality of physical assets can be verified by blockchain technology creating reliable, end-to-end visibility. This helps build both company success and customer satisfaction.

The future is now.  Don’t think so?  Well, check out Nike’s Cryptokicks that they received a patent on.

Contact Karana IP for NFT Consulting & IP Protection

If you are an artist, creator, or business considering selling works, collectibles, & art collections on NFTs, the need for protecting your intellectual property works have never been greater. Is someone infringing your works by minting NFTs that violate your intellectual property?
If you need help with copyrights, trademarks, or NFTs, contact Karana IP Law for help navigating this new and exciting space. Schedule a free consultation to begin encountering this novel industry.

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