Physical Backed Token (PBT): No More Counterfeits!
The Physical Backed Token (PBT) is a novel token standard that unites tangible objects and NFTs through Ethereum's blockchain and cryptographic chip technology. Pioneered by Chiru Labs, a Web3 studio renowned for their Azuki collection, this asset may present a breakthrough in tokenization.
PBT provides a decentralized way to verify and demonstrate a product's authenticity, tracing the history of its ownership.
The PBT standard can be an invaluable tool for luxury brands dealing with counterfeit issues, and art galleries that showcase physical collectible items.
Although digitalization and tokenization are not fresh concepts, the direct link of a tangible object with a token, and the subsequent transfer of its ownership to a new holder, is an innovation.
Features of the PBT Standard
Upon purchasing certain NFTs, you might be offered real-world gifts, rewards, and benefits. PBT shakes things up. This cutting-edge technology enables the minting of a unique token tied to a tangible item, which can then be transferred to your crypto wallet.
This is made possible by embedding a cryptographic microchip into the product. This chip autonomously generates public and private keys for asymmetric encryption when scanned by a phone.
Consequently, whoever possesses the physical item also owns the token minted via the PBT standard. When the physical product is handed over to a new owner, a rescan is required to rewrite the NFT ownership.
Physical Backed Token is a publicly accessible, open-source technology. Any users intrigued by crafting their own physically-secured tokens can leverage it.
What PBT-compatible products has Chiru Labs released?
In October 2022, Chiru Labs conducted a PBT auction in association with the Azuki NFT collection. The company crafted eight gold skateboards, bearing a dragon engraving at the back and symbols from The Garden metaverse. One of these skateboards fetched a whopping 309 ETH.
Additionally, Chiru Labs collaborated with the Ambush brand to roll out a capsule collection of Azuki-inspired hoodies that are compatible with physically-backed token minting.
A PBT-compatible hoodie from the Azuki X Ambush collection, source — ambushdesign.io
Drawbacks of the Physical Backed Token
The broad use of PBT is not without obstacles, including the notable limitation associated with the expense and shortage of microchips.
It's not always possible to integrate a chip into every item without affecting its appearance, especially in cases involving delicate jewelry or clothing made from fine fabrics. While advancements in chip production have led to impressively small, inconspicuous units, it's uncertain how tiny cryptographic chips can become.
Over time, these chips might simply break or stop working, negating the original concept. Although it would be possible to replace or repair the chip in such cases, this could lead to logistical complications.
Currently, the Physical Backed Token standard serves more as a novelty for the wealthy rather than as a solution to verifying product authenticity.
