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October 2012

The Role of Blockchain Technology in High-End and Luxury Retail

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blockchain technology

blockchain technology

For every luxury brand, class and sophistication remain key attributes that make them different from other run-of-the-mill brands. The customers of luxury products generally remain very sensitive to the delicate aspects of products. In recent years, blockchain technology has emerged as a solution for serving this clientele.

With an estimated market value of $3 trillion, luxury items offer a big opportunity for retailers. But being successful in this niche requires a solid command over the technologies and tools in order to ensure more transparency, product value, and a great shopping experience.

In this post, we are going to explain the key attributes of blockchain-based luxury retail and the key advantages of using blockchain technology for the retail market.

Blockchain in Retail Fashion & Luxury: Key Value Propositions

Blockchain is becoming increasingly popular as a technology solution for the retail industry. There are many benefits of using this technology, but here we will first have a brief look at the key value propositions of blockchain for luxury retail.

  • Transparency: Thanks to blockchain technology, customers can have access to company claims that can be verified instantly before trusting any information.
  • Easy way to track: Thanks to easy traceability, companies can keep track of the entire process and provenance of various products from their sources to the sales counter.
  • Easier trading with the value: Blockchain technology will also integrate digital currencies like Bitcoin or Ethereum for tokenizing the value of various assets and make transactions through them.

Apart from these key attributes, blockchain can help modern retail in many ways and literally bring about a revolution in the retail of luxury products. Let us explain these advantages one by one.

>> Bitcoin Soars Above $9K Mark with Strong Momentum

Blockchain for Retail of Organic and Sustainable Luxury Items

There are many products that simply bear the “luxury” tag because of their organic roots and sustainable ingredients. Blockchain technology can actually help the practices and traditions of these organic products, in addition to helping their marketability.

Blockchain is capable of tracking any product throughout its entire life cycle, including its constituent ingredients and their sources.

The tremendous boost to transparency in supply chain tracking gives the manufacturer brands and retailers a detailed bird’s-eye view of the entire value chain. From the sourcing of the ingredients to the entire processing of various parts to the assembly line to the labeling of the goods, blockchain can keep track of every detail of the entire product life cycle. This will maintain better quality and authenticity of the organic and sustainable production practices.

Redefining Customer Experience

Since luxury items are expensive, customers expect great shopping experiences and great post-sales support from the brands. Good customer service is a prerequisite for any luxury brand to survive and flourish with popularity among its target audience. Blockchain technology can help retailers and manufacturers play a more responsible role for delivering great customer experience.

It is a known fact that buyers of luxury items have zero tolerance for mediocrity in customer service or business processes. Naturally, regular customer service provided by common brands just cannot fit the customer expectations of luxury brands.

Blockchain-based payment solutions like smart contracts can help customers to enjoy a more transparent payment process. With smart contracts, the payments are initiated only when both the sellers and the customers reach an agreement on the conditions of the transaction. This means the technology allows customers to pay for a product only when they are fully satisfied. 

Superb after-sales service remains a key part of great customer service. The support team always works hard to help customers get the most out of their high-value items. Many manufacturing companies, particularly in the automobile and high-value gadget sectors, make a substantial income through the post-sales support. This is where a blockchain-based transparent supply chain and post-sales tracking of customer issues can play a great role.

Blockchain for Building Consumer Trust

For most fashion and luxury brands, transparency scores tremendously low, and most of them suffer from credibility crises among the users who have purchased their products once or a number of times. For fashion brands and luxury retailers, boosting this transparency score and improving consumer trust is extremely important. By using blockchain, luxury brands can now help customers authenticate and verify the processes and get a complete overview of the production very easily. Blockchain is increasingly being relied upon by luxury retailers all over the globe, principally to boost their credibility with a more traceable and transparent process open to their audience.

Trust of business brands is at the topmost priority for influencing buying decisions of consumers worldwide. From making the supply chain processes transparent and traceable to building consumer trust scores, blockchain technology and smart contracts can play a great role in assuring this. A better trust score and transparency will also improve the branding and connection with the target audience for business brands.

>> Ethereum Soars Over 125% Since March: What to Expect Now?

Improving Data Management Through Blockchain

Many brands experience that data management in silos actually leads to less optimized processes and other critical issues related to reconciliation between several parties. This is where blockchain can play a great role, as the technology allows appending information continuously and securely while allowing access to this pool of information for different stakeholders and participants in a business process. When sharing information is crucial for maintaining optimum data security and trust, blockchain is the technology to opt for.

Blockchain for Reducing Costs

Finally, blockchain technology also plays a significant role in reducing the operational costs in the high-end retail fashion and luxury industry simply by helping with the quality of data management tools, boosting supply chain management, and minimizing the risk of counterfeit products and infiltration of grey market items.

Easier and smooth data management also helps reduce cost in other ways. In-time access to operational and business data helps to manage inventory and build trust in the outsourcing process. Blockchain offers a low footprint and easier way to append data layers to keep various processes in sync and informed.

Conclusion

The role of blockchain technology in high-end and luxury retail has already proved to be effective. In the years to come, more business brands entering into the luxury niche are likely to opt for blockchain technology.

This article was curated through CryptoCurrencyNews’ Contributor Program. If you would like to write for us, send us your submission!

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Square Crypto Adds 3 New Members to Complete Inaugural Dev Team

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Square

Square

Over the years, Square (NYSE:SQ) managed to emerge as one of the most innovative payments company in the United States, and it is no surprise that the company came up with Square Crypto in 2019. Back in March this year, Square made the announcement that it was going to go into crypto, and now the company has started hiring to kickstart the project.

Completes Inaugural Developer Team

The company announced that it has completed the ‘inaugural developer team’ for the project and has made key appointments already. The development team will be involved in developing the base for Bitcoin development, and it is going to be open source in nature.

One of the appointments to the development team is that of Arik Sosman, who previously worked at BitGo and Facebook (NASDAQ:FB). In addition to Sosman, the other two people added to the Square Crypto team include Jeffrey Czyz and Valentine Wallace. Wallace used to work for Lightning Labs while Czyz had been associated with Google (NASDAQ:GOOGL). Sosman shares his thoughts after having joined this small team. He said, “I’m extremely excited and grateful for the opportunity to join this amazing team, and to focus on contributing to the most important cryptocurrency and ecosystem.”

>> Coinbase to List Telegram and Polkadot Cryptocurrencies Soon

That being said, the company had earlier sent out a tweet on Thursday in which it stated that it was still unsure about its first crypto project. The new business created by Square is going to be completely separate from its core payments business.

However, it is still a major development for the crypto space and is another indication that some of the more serious tech-based firms in the world have grasped its importance. The other existing team members include Steve Lee and Matt Corallo. Lee stated that at this point in time, the team is prepared to take up any crypto project as long as it goes towards the improvement of Bitcoin.

Featured image: DepositPhotos © Jirsak

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Social Media Companies Join the Crypto World

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social media

social media

The cult of cryptocurrencies is rising with each passing day. But to understand the reason behind this, it is quintessential to know what exactly is cryptocurrency? Cryptocurrencies are digital currencies set up by groups of individuals and secured using cryptography. It is basically a form of digital ledger. Usually, cryptocurrencies are based on the technology called blockchain. A blockchain, originally block chain, is a growing list of records, called blocks, which are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data.

Thus it contains a detailed list of information as to who has given what to whom; and who owns what. This data is permanent and irreversible thereby making it virtually impossible to create counterfeits. Since cryptocurrencies are largely free from government regulation, many investors and companies are attracted to their possibilities.

With the growing craze of cryptocurrencies, many big social media giants have decided to develop their own cryptocurrency. Since social media is a platform that involves “public” at large, the rage of cryptocurrency is soaring.

Most recent to join the race is VKontakte (VK), the most popular social media platform in Russia. Quoting from the recent report of the Russian news outlet RNS:

“According to [the unnamed source], the current configuration of the project involves the creation of individual accounts for the accumulation of cryptocurrency to all users of the social network.”

Once the cryptocurrency is developed, it would be able to be used by the site’s nearly 100 million active monthly users. However, the Russian social media giant has neither confirmed nor denied any rumors in context to the plans of developing a cryptocurrency.

>> What Does the Bitmain IPO Abolition Mean for Cryptocurrency Industry?

Certainly, VKontakte (VK) is not the first social media company to be lured by the appeal of cryptocurrencies. Much of the drive and inspiration comes from the popular US social media giant Facebook. Facebook, too, is working to formulate its own cryptocurrency. The Facebook crypto will be a coin associated with WhatsApp, allowing for near-instant transfers between users.

Counting on the public involvement at large, these social media companies are of a belief that users would readily begin to interact with cryptocurrencies. Thus, the future may see more and more companies joining the crypto world.

Featured image: Pixabay

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Bitcoin.com to Launch a Bitcoin Cash Supported Futures Contract

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Bitcoin Cash

Bitcoin Cash

Cryptocurrency investor Roger Ver’s Bitcoin.com is in talks with Bitcoin Cash (BCH) to launch a futures contract. David Shin, the company’s head of the exchange division, dropped the revelations regarding the prospect. The company is also working on different plans to enhance its interest in Bitcoin Cash together with the futures contract.

Futures Contract to Make the Cryptocurrency Third Largest

The introduction of the futures contract will have the goal of increasing the company’s market capitalization of cryptocurrency. This will make it the second-biggest crypto behind Bitcoin. Shin confirmed that within a year they want to create the second- or third-largest crypto by market cap. He added that to move from fourth to third or second, the company would need to see more volume.

Currently, talks are ongoing to list BCH derivate products on the Commodity Futures Trading Commission. With no CFTC-regulated exchange offering Bitcoin Cash futures, this push will enhance trading volumes as well as liquidity, which will then boost the market cap of BCH.

Bitcoin Cash is currently the world’s fourth-largest cryptocurrency in terms of CoinMarketCap. To move even one place the crypto will have to double its market cap, as XRP, which is the third-largest crypto, currently sits at a $10.9 billion market capitalization. According to Coindesk data, on Thursday, BCH was trading at $300 per coin with an estimated market cap of around $5.4 billion.

>> France Pushes to Block Development of Libra in Europe

Bitcoin.com to Approach CME Group to List a BCH Futures Instrument

Shin also indicated that the company had begun discussions with a US-regulated crypto futures exchange. There are also plans to approach the Chicago Mercantile Exchange Group (CME) with a proposal to list a BCH-backed futures tool. Crypto futures are a new phenomenon to US investors, and CME is the main distributor of Bitcoin futures in the US. It is already planning to unveil another Bitcoin derivative product.

Shin said that the company will try and list Bitcoin Cash futures on one of the exchanges that are CFTC-regulated.  This will enhance the company’s reach, which means it will have more users and trading, which will boost volumes.

Featured image: DepositPhotos © merznatalia

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