How to use NFT (Non Fungible Token) for product ownership and authentication?

Non-Fungible Tokens debuted in the emerging technologies scene in 2017, but it wasn’t until the sale of a Beeple artwork for $69 million in 2021 that they gained worldwide attention.

So far, NFTs have mainly transformed the digital art industry, allowing creators to protect copyright and intellectual property rights. However, as a technology still in its early days, much is not yet understood about its true and full potential.

Nevertheless, one thing is certain: NFTs are changing product ownership and authenticity as we know it today. For companies looking to secure their products through every step of the supply chain, NFTs can represent the key to an effective and bulletproof end-to-end product authentication strategy.

Learn about the impact of NFTs on product authentication and ownership in this guide – or visit to learn more about new use cases for NFTs.

What is an NFT?

NFT stands for Non-Fungible Token. At their core, NFTs are a string of letters and numbers or a piece of code that acts as the digital representation of a physical asset. The original goal of NFTs was to enable the exchange of two or more commodities with unique, non-fungible values.

When these digital or physical assets with an associated NFT are exchanged, bought or sold, each transaction is recorded and stored on the Ethereum blockchain. In turn, these records are easily traceable, immutable and impossible to tamper with.

Today, NFTs are primarily used to represent the ownership of an asset and to enable certain crypto transactions. However, new use cases are being found every day in industries such as product authentication, membership exclusivity and digital identity verification.

The features that make NFTs unique

When it comes down to understanding the full potential of NFTs for product ownership and authentication, it is important to review the characteristics that make them unique. These include:

• Unparalleled transparency and traceability of transactions recorded on the blockchain
• The standardization of protocols, which makes NFT interchangeable on several different platforms
• NFTs can be traded openly and in a free market
• NFTs are liquid assets, meaning they can be immediately sold for cash
• NFT transactions are immutable and impossible to tamper with (source)

Understand the case for NFT for product ownership

While NFTs can be bought and sold on free marketplaces, owning an NFT is not exactly the same as owning the underlying asset to which they are linked. For example, buying an NFT linked to a work of art will not give the NFT buyer automatic rights to the work of art itself.

When purchasing an NFT, buyers should conduct the necessary due diligence to understand the terms of the purchase contract, says MakeUseOf. Although the seller may transfer ownership of the physical asset or intellectual property rights, this should not be taken for granted.

The smart contract encoded with the NFT will be a binding contract that determines the rights the new owner acquires when purchasing an NFT. The best technology for authenticating and tying tangible products with digital NFT ownership is Authena M3TATM, the solution that authenticates the bridge between the metaverse and the physical world.

Using NFT for product authentication: NFT Authenticity Seals

While using NFTs for product ownership comes with nuances that may not be so easy to understand from a legal standpoint, the benefits of NFTs for product authentication are much more straightforward.

NFTs are used to create a digital twin of a product and are embedded in a smart label. As the product moves through the supply chain, and the smart label is scanned via enabled devices, a trail of transactions is created on the blockchain.

This immutable and authentic information can then be accessed by both the manufacturer and the end user, who can verify the authenticity claim from the brand itself.

These authenticity labels allow brands to protect themselves from the threat of counterfeiting and fraudulent activity and enable consumers to make better informed choices about their purchases.

You can learn more about the benefits of using NFTs as part of your product authentication strategy by visiting this link: .

The benefits of using NFTs for product authentication

At their core, NFTs are immutable certificates used to validate the authenticity and ownership of a product. But what really makes these strings of code so innovative is the fact that their work is on a blockchain-based technology, which reaps the benefits.

Some of the benefits of using NFTs as product authentication tools include:

• Blockchain environments are designed to prevent data loss
• Blockchain systems are decentralized
• Thanks to a peer-to-peer security protocol, transactions cannot be easily changed without blockchain users’ consent
• Blockchain transactions are immediately traceable and accessible

Work with a product authentication expert to implement NFT seals of authenticity

Implementing NFT technologies into your product authentication system is quite easy, especially when you work with a specialist who can better understand the needs of your company and its supply chain. Also, a product authentication expert can help you skip the pitfalls of implementing a new system by delivering an end-to-end, turnkey system that requires minimal training.

Last updated: 6 September 2022