The Future of The Luxury Industry With Blockchain Technology
Key issues for the luxury industry
Today, the luxury industry is highly fragmented and afflicted with issues of counterfeiting, authenticity, and unethical sourcing of raw materials. Counterfeiting has grown into a global and highly-sophisticated market worth billions of dollars. According to Global Brand Counterfeiting Report 2018, the estimated losses due to counterfeiting of luxury goods amounted to US$98 billion, one-third of which accounted for online counterfeiting. Consequently, protecting brand authenticity has become one of the main tasks in the companies’ business agenda.
Environmentalism has as well turned into a key driver of choice in the market. According to IBM’s US Retail Index 2020, the growth of environmental awareness is changing consumers’ habits which drives brand choice. Today, it is important for customers that brands offer “clean” products, are sustainable and environmentally responsible, support recycling, or use natural ingredients.
Blockchain as a solution
Since the advent of e-commerce, we have observed the increasing use of New Technologies in Fashion & Luxury: from Big Data to AI and more. Blockchain now appears as an effective tool the luxury industry is already embracing to tackle challenges that include counterfeiting. With a decentralized system, blockchain makes the data transparent and immutable and allows consumers to track with ease the product’s authenticity, information and history. For brands and retailers, it is a solution to protect the authenticity of the products and foster customers’ trust by making supply chains transparent and customer-centric. With the creation of a unique digital twin of a product, its entire lifecycle can be traced from the stage of manufacturing, sale, and future resale.
As for the environmental concerns, transparency and traceability provided by blockchain technology allow consumers to track the product’s entire manufacturing history, which then contributes to the overall view of the company. Sustaining a good image is one of the driving factors for high-end fashion companies.
LuxFi — The new future for real-asset luxury brands
The benefits of blockchain in terms of transparency, traceability and authenticity prove to be of significant importance for luxury brands to adopt blockchain technology. LuxFi marketplace makes authenticity, transparency and traceability a high priority. We use NFT technology to create digital twins for physical luxury assets. The professional verifiers in our network authenticate all the products in our NFT marketplace or we directly tokenize our brands/retailers partners products. Each NFT is provided with accurate pricing that is backed by real-world data. LuxFi marketplace offers luxury retailers and luxury assets owners new ways to meaningfully engage in a platform supported by blockchain for trading and considerably increase luxury assets liquidity and value.
About LuxFi
LuxFi is the world’s first asset-backed NFT marketplace for luxury assets, where people can buy, sell and invest in luxury assets using cryptocurrencies and traditional payments. We eliminate counterfeiting while minting an NFT on a multi-chain blockchain network, with a focus on luxury assets that hold value well and have a high resell value. Leveraging our big data intelligence system and unique algorithm for automated data collecting and data processing, the value of each NFT on our platform is backed by real-world data.
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