How Artificial Intelligence and Blockchain Fight Counterfeit in the Luxury Market?

Earlier this month, artificial intelligence (AI) entropy authentication was introduced as the authentication provider for luxury handbags belonging to the TikTok store in the US.

It uses a combination of artificial intelligence and microscopy to assess the authenticity of an item. When the item is scanned using the garment’s dedicated device and app, a series of microscopic images are collected, which machine learning algorithms then compare to a database containing millions of records of known authentic and counterfeit products.

Based on the results of this comparison, the AI ​​either confirms the authenticity of the items or returns an unverified result. Each scan from an Entrupy device becomes part of this database, further training the algorithms and making the solution smarter and more accurate.

For most cases, the process of scanning and submitting for authentication using the Entrupy app takes between three and five minutes. In some cases, it may take up to an hour, and Herms Premium items may take up to 24 hours.

Artificial intelligence is only as good as the data it feeds its algorithm, so the company works with data scientists, engineers and research experts who feed data into the technology in real time to support the process. The company was launched in 2012 and has been gathering data to inform its algorithms ever since. According to Entrupy, its authentication has an accuracy rate of 99.1%.

TikTok seller Kimmiebbags welcomes the integration. “Now anyone who buys through my page can be sure that their purchases are authentic,” he said in a statement.

Entrupy founder and CEO Vidyuth Srinivasan added: “We want to make sure that shopping for luxury items is a seamless experience. This merger allows us to continue our mission to protect businesses and consumers from purchasing counterfeit items.

For the record, the total amount of counterfeit goods sold worldwide each year is about $1.7 trillion to $4.5 trillion, so the authentication business is also a lucrative business.

Swiss-based Origyn was the first mover to authenticate luxury watches, partnering last year with WatchBox, a leading platform for the certified luxury watch market. Origyn uses a combination of human experts alongside a dedicated device that likewise has artificial intelligence plus ultra-high-resolution cameras that take 360-degree photos of the watch. It also issues a digital certificate containing the watch’s biometric fingerprint secured through blockchain.

However, while using authentication technology in the $120 billion secondary market is perhaps the fastest way to roll it out, luxury brands themselves are playing the long game and integrating anti-counterfeiting measures at the source.

The Aura Consortium (founding members of LVMH, the Prada Group, OTB, Mercedes-Benz and the Richement Group under the Cartier brand), reviews the pre-testing of items, placing clothing, accessories and jewelery on the chain as they are created. It issues them with unique digital IDs to prove that they are indeed genuine.

These identifiers also have additional benefits such as information about their origin and manufacturing process for transparency and traceability purposes. Immutably encrypted via the blockchain, they are linked to the physical item by a near-field communication (NFC) chip in the case of Margiela accessories such as Tabi shoes or quick response (QR) codes in the case of knitwear by Loro Piana. are related .

Said certificates can be transferred when changing goods and provide guarantees for buyers in the secondary market.

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