On 10 August 2020, the Australian Government’s IP Australia, announced the start of a trial for its blockchain-powered Trust Badge, in collaboration with their National Rugby League (NRL). This is an effort to tackle the issue of counterfeit rugby fan gear, the Trust Badge being a digital stamp of authentication.
The solution aims to connect the product’s trademark to the online store from whence it came, which in this case includes outlet stores. The government trialed the Trust Badge on the official NRL online shop and the outlet store Savvy Supporter, which has been selling official NRL, Australian Football League, and Union and Football merchandise since 2008.
The way the Trust Badge works is by linking the trademark of the product to the online website. Then, after the consumer has clicked the badge on the page, it shows them the details of the trademark itself linked to the blockchain, which will authenticate the store.
However, the issue is that the badge itself is relatively easy to copy. Blockchain will be used to verify the information and legitimate use of the badge and manner in which the data is stored makes it extremely difficult to alter.
However, it may be tricky to ensure that the data displayed came from the blockchain. For example, someone retailing counterfeit goods could steal the badge and add it to their website. When a consumer clicks the badge it could display a popup with false information that appears to come from Australia IP’s blockchain. Only a determined consumer might detect the fraud.
An IP Australia spokesperson told Ledger Insights: “The Trust Badge is an early concept of how IP Australia can build an application to help consumers identify authentic products and services online.”
“While the concept aims to help discourage trade mark misuse online, it’s not considered a ‘silver bullet’, instead it is a useful tool in a growing arsenal of anti-counterfeiting tools available to brands. Through this current trial of the Trust Badge, we are investigating ways to make it more robust and ensure it helps curb those who look to misuse trade marks.“
If Trust Badge can address the potential flaw outlined above, brands such as Rolex may very well be interested. Their website stipulates how only ‘official Rolex retailers are allowed to sell and maintain a Rolex watch,’ who will guarantee the authenticity of the Rolex watch.
Other high-value products that are particularly vulnerable to counterfeiting, such as designer bags might also benefit. Luxury watchmaker Breitling already started using blockchain as a means to prove the authenticity and ownership of a limited edition timepiece, by providing consumers with a blockchain digital passport.
Often anti counterfeit solutions work by using smart labeling and/or by tagging the actual product. For example, by inserting tags inside clothing hems, as done by the NBA team Sacramento Kings, who used blockchain to track their player-worn jerseys, some of which were then sold to aid the Hurricane Dorian relief. This method was also used by Italian football club ACF Fiorentina to authenticate their match-worn jerseys, tagging the actual jerseys, which would then be linked to the blockchain.
Other types of tags include RFID, NFC labels, and QR codes, however, some of these can be relatively expensive. With RFID tags, several costs will need to be considered, starting from equipment, installation, and tag costs, to software, license, and maintenance costs. In this regard, the Trust Badge could be a cost-effective alternative. However, it remains to be seen whether counterfeiters will exploit the technology for their counterfeit products.
Update: the quote from IP Australia was added