Blockchain adoption game for anti-counterfeiting between competing platform retailers

Blockchain is a promising solution to combat counterfeits. We employ a game-theoretic approach to explore the blockchain adoption game between two competitive platform retailers to combat counterfeits. We develop a duopoly model with one high-end and one low-end platform, both vulnerable to counterfeits. The high-end platform provides a superior quality of genuine products over the low-end platform. Blockchain allows consumers to discern product authenticity. We demonstrate that in a scenario of low blockchain cost, either both platforms will utilize blockchain technology or only the high-end platform will adopt it. Both platforms adopt blockchain if the product authenticity of the low-end platform is low, or the quality of authentic products on the high-end platform is high; otherwise, only the high-end platform adopts blockchain. Surprisingly, we also show that when counterfeit quality is high, adopting blockchain to combat counterfeiting is more likely to reduce the profit of the low-end platform.