As the field of blockchain technology rapidly expands, there are an increasing number of impressive and revolutionary projects being developed. One of the most positive fields that the blockchain is tackling is that of preventing counterfeit goods. Companies like Waltonchain, VeChain, and WaBi are all tightly focused on this area, with the aim of providing the public with more trustworthy goods. This is particularly important for food and drinks, where customers must trust that the goods they are consuming are accurate and safe. Counterfeiters have been mass producing fake branded food for an extremely long time, and in some cases, it can lead to severe injury. One of the most famous and tragic examples of this was the 2008 Chinese milk scandal in China.
Investors are starting to recognize the potential of such systems and are excitedly buying in and supporting the cause.
To understand this technology, you must first understand what RFID (Radio-frequency identification) is. It is a means of identifying and tagging physical goods through the use of radio waves. In some ways it is similar to tagging through barcodes, but it is more efficient and foolproof as RFID products can be identified from long distances. This is not a particularly new technology, but it has not been used in conjunction with a blockchain or cryptocurrency before.
It is only when an organisation like Waltonchain joins RFID technology with the expansive capabilities of the blockchain that we have a system which is powerful enough to prevent counterfeits. In a simplified form, the idea is that every business that partners with an organisation like Waltonchain, WaBi, or VeChain would incorporate an RFID chip into each individual product they sell (whether that be clothes, computers, drinks, or even consumables like cigarettes). Each RFID chip would have a unique cryptographic phrase (sometimes called a hash) coded into it. When a customer buys one of these products they can simply scan the product with their phone and use the blockchain to automatically determine whether the product is genuine or fake. The blockchain would be able to directly inform the user about the status of the product, from when it was made, to how it was transported. It allows for the consumer to get hold of the most important information about their purchases.
Investors and traders are beginning to value these types of cryptocurrencies extremely highly. The financial technology is filling a huge gap in the market, and many of these companies have a solid team with working prototypes. During December the prices of Waltonchain, VeChain, and WaBi all rose to significant heights, showing the public just how much of a demand there is for anti-counterfeiting tools.
Determining fake products with a blockchain application on your phone is extremely easy too. More times than not, most counterfeiters won’t even bother to place an RFID chip into their products, so if the app doesn’t scan it then it should be avoided. In the rare case that counterfeiters do use RFID chips, they would never be able to create a chip which could fool the blockchain as every genuine chip would contain a cryptographic code which cannot be duplicated. This effectively means that in the foreseeable future all counterfeit goods will be abolished.
These types of blockchain projects are extremely new and the technology needed to support them is revolutionary. Currently, we do not have any company which successfully uses RFID chips in this way, but extensive tests have taken place which shows that it is possible to do so on a large, mass-produced, scale.
Many traders are investing in cryptocurrencies which focus on anti-counterfeiting methods, as they push the boundaries of what we normally consider currency, whilst also being used for a good cause. The technology is predicted to be ready for use in 2020, effectively meaning that any investors are still early adopters. If the technology takes off, it could revolutionise the industry of trading as a whole.
Preventing counterfeits is something that people feel passionately about, especially in countries like China where illicit and misleading goods of this nature are arguably more common. To understand the severity of this, you only need to watch videos like this which show the mass production of fake goods. It is no longer possible to tell if something is fake simply with the naked eye, we need trustless, immutable, technology to help us out.