New Balance to use blockchain to stop counterfeit shoes
Tennis shoes are getting a boost from the blockchain. New Balance has announced it is working with the Cardano blockchain to develop an authentication system that will help consumers quickly and accurately determine if their shoes are the real deal, or counterfeit knockoffs. The program reportedly revolves solely around the Cardano blockchain, created by Hong Kong-based FinTech firm IOHK, and won’t use the platform’s associated ADA cryptocurrency.
According to a report by Decrypt, Cardano CEO Charles Hoskinson announced the new partnership during a celebration of the company’s second anniversary. Festivities marking the anniversary were held in Plovdiv, Bulgaria and Hoskinson spoke about the new arrangement during the celebration, stating:
It provides a lot of things to New Balance that they’re really struggling with. Last year New Balance confiscated around 25 million pairs of fake shoes. Authentication is a very expensive proposition for a bunch of brands. What we can bring to the table is not only a very better way for them to accommodate this but also potentially create a marketplace.
According to figures provided by the International Trademark Association, about $1.13 trillion in revenue was lost to counterfeit products last year. The new blockchain platform will be able to establish provenance and determine if any products are being manufactured outside of expected channels. It can also help ensure that commissions and royalties are properly distributed to their intended destinations.
Hoskinson added, “Rolex, Louis Vuitton, Gucci—if you work with these companies, you can dramatically reduce counterfeiting risk, create better supply chains and better markets for their goods. And, frankly, it can give them the ability to sell their goods at even higher prices—because they can have the authentic blockchain version of the bag, and they can mark it up considerably.”
How the platform will work and more specifics of the partnership are forthcoming. According to Decrypt, New Balance is expected to make an official announcement this month, at which time the shoe and apparel company will divulge all the particulars.
From lettuce to wine, and now shoes, more products are continuously finding support from blockchains. Walmart has begun to track supply chains for many of its suppliers using the technology and France-based grocery chain Carrefour has its own internal blockchain to track milk delivered from its suppliers. Several wine producers have also embraced the innovative technology, allowing consumers to verify the origins of their purchases.
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