LVMH, Consensys and Microsoft: visionary supply chain with Blockchain

LVMH x Blockchain
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In June, the permissioned blockchain tracking the production of the entire LVMH group will be launched. Louis Vuitton and Christian Dior will open the way.



LVMH, the luxury brand conglomerate, owner of brands such as Louis Vuitton, Christian Dior and Dom Pérignon is about to launch the first permissioned consortium blockchain platform to track and certify luxury goods.

The platform has a name: AURA. It is one of the first examples of blockchain technology applied to supply chain management, realized in partnership with Consensys and Microsoft.

Pilot project could scale to many large global brands

The platform is built on Ethereum Quorum and will allow consumers to access the history of a good from raw material to the point of sale.

“AURA Certificates” will be initially used by the LVMH Group. Nevertheless, as a consortium model, it can also extend to other global brands.  

AURA Certificates will include information on the authenticity, origin and components of the product. Features includes ethical and environmental information, instructions for product care, and the after-sales and warranty services available.

Consensys worked along LVMH to develop the smart contract and blockchain while Microsoft contributed with its cloud services platform Azure.

Blockchain: perfect technology for supply chain purposes

AURA will be the infrastructure to connect retailers and their various suppliers along the supply chain. Ideally, every major member of the supply chain will host a node. Each node will share the same information that other nodes have access to, in a synchronized manner.

Blockchain can bring several advantages in decentralized layouts:

transparency, as all the actions performed are visible in real time by nodes with permission
immutability, because one single agent cannot modify the information stored on the blockchain without the consensus of the other nodes
coordination of the different parties in the same supply chain will be much easier.

Image result for blockchain supply chain

The smart contract containing all the roles and responsibilities of the different parties is stored on the blockchain.

It can include rules on the storage of perishable goods, certificates of origin and the responsibilities of every single actor.

Each passage can be recorded on the smart contract by the “author” traced in real time by the other nodes. This means that authentic goods must come with the AURA certificate. This system makes also possible to investigate any infringement of the smart contract extremely quickly. In the same way, errors can be traced precisely and corrected instantaneously, without giving them the chance to propagate along the supply chain.

A technology used and developed by JPMorgan…and Cryptokitties

According to Consensys, the AURA platform is thought to be a tool for many luxury brands; not only those belonging to LVMH group. It is based on Quorum, a permissioned platform based on Ethereum developed by JPMorgan. This permissioned platform is used it to clear and settle wholesale payments for institutional clients.

Lastly, smart contracts are based on the ERC-721 standard, the standard used for non-fungible tokens (NFT) technology at the base of the famous game CryptoKitties. Non-fungibility is a set of features of an asset that make it unique, therefore cannot be replaced by another.

Hence, ERC-721 standard can be used to represent unique things (e.g. luxury goods), opposite to ERC-20 at the base of many cryptocurrencies, that is more suitable to fungible assets like currencies or network tokens.

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Consensys, Retail Dive, IBM, Blockonomi, Aqurus,

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