Storied auction house Sotheby’s will auction a rare diamond-studded ring and guarantee its authenticity through an NFT, as luxury brands look to blockchain tech to help tackle the scourge of counterfeiting.
The auctioneer will put up for sale a rare ring from Austrian jeweller Schullin, a handmade platinum piece featuring a 49,88 carat Paraiba Tourmaline gemstone and 60 diamonds, estimated to be worth between £140,000 to £180,000. The ring will be auctioned on November 9.
This will be the first time an auctioneer has relied on blockchain-powered tech like NFTs to guarantee the authenticity of a piece for an auction. This is a significant vote of confidence in blockchain technology: after all, an organisation that is 278 years old is choosing to stake its reputation for authenticity on technology that has been around for just about a decade.
The company used tech developed by London-based start-up Database of Native Assets (DNA), which creates NFT “digital passports”, known as Native Assets, that can help companies prove the authenticity and ownership of jewellery, collectibles, art, rarities and luxury goods.
Native Assets, like NFTs, are made up of tamper-proof digital records on the blockchain that help owners track a physical item throughout its lifespan, giving them access to historical transfer information, product identifiers, and hallmarks.
Lukas Schullin, the manager at jeweller Schullin Wien, said: “It offers the power and security of the blockchain without all the headache of having crypto currency and a digital wallet.”
NFT technology can be particularly appealing to companies selling luxury goods that are often passed down or traded for generations, such as jewellery and watches, as information recorded on a blockchain is theoretically impossible, or at least extremely difficult, to tamper with or modify.
The world’s market for counterfeit and pirated goods was estimated to be worth $449 billion (£405 billion) in 2019 by the OECD, or more than Ireland’s economy at the time, and estimates say that as many as 10% of all branded goods sold may be counterfeit.
People’s growing appetite for online shopping also removes the physical element of a purchase, which can make it more difficult for consumers to discern a fake good before buying it.
“There is a certain anonymity about products on the web which makes fraud and counterfeiting rampant,” DNA co-founder and CTO Abraham Milano, said. “Our mission is to fix that so that brands, creatives and their customers are protected.”