All luxury brands are invited to use (for a fee) Aura, says LVMH, and this ambition to create an industry standard lends the project an air of credibility. As does the involvement of ConsenSys – a well-funded developer linked with the Ethereum blockchain – and Microsoft, who helped build Aura.
But brands have a history of gimmicks and false starts when it comes to blockchain, and it is right to retain some scepticism while staying open minded about the possibilities.
For instance, what actually links the physical luxury products being sold to their corresponding profiles on Aura? We can see how Aura’s ownership certificates discourage fakery, but without a way to chain the physical to the digital, there are still opportunities for motivated fraudsters.
And Aura is a private blockchain. Our understanding (which has its limits) is that blockchain works best as a decentralised and distributed system where there’s no need for trust because there is no person or no organisation in which to place your trust – the code is in charge. Otherwise, what’s the point?
In 2019 Gartner wrote that blockchain technology had entered the ‘trough of disillusionment’ phase of its hype cycle, and that it would be five or 10 years before it was put to good use.
It’s possible that the pandemic, which has forced people to spend more time online, has shortened that timeline and Aura heralds a new spring for blockchain. But there are good grounds to ask if LVMH, Prada and Cartier could have more easily achieved its aims with a website and a spreadsheet.
Without that necessity, any distributed ledger tool becomes more about leveraging the blockchain brand than harnessing the technology itself. That could be enough, if the luxury brands just want to demonstrate to customers that they believe in transparency and good stewardship, but it doesn’t make for a useful tool.
