Ticketmaster, one of the world’s largest ticket sales and distribution companies, is turning to blockchain technology in order to combat the costly and persisting issue of ticket fraud.

The company will be using a newly acquired blockchain startup, called Upgraded, to create DLT-based “smart tickets,” that utilize the blockchain to combat fraudulent ticket use, increase the company’s transparency, and to reduce the possibility of ticket scalping.

Ticketmaster, who merged with entertainment giant Live Nation Entertainment in 2010, has been the subject of numerous controversies, mainly surrounding their monopoly over the live entertainment industry, with the vast majority of concerts and live event ticket sales being conducted by Ticketmaster.

Earlier this year, the Department of Justice launched an investigation into Ticketmaster and Live Nation following claims from the company’s main competitor, AEG that they were actively engaging in unethical business practices.

The company has also been hit with a class action lawsuit that accuses them of running their own ticket scalping operation, which harms buyers by artificially inflating the ticket costs. As part of this lawsuit’s settlement, the company began offering free tickets and major discounts to customers potentially affected by the operation.

The acquisition of Upgraded and the creation of “smart tickets” is likely as much of an effort to reduce Ticketmaster’s own fraudulent activities as it is to reduce external fraud. By using blockchain-based tickets, the company can ensure that all the details regarding the sale and transference of ticket ownership is logged in an immutable fashion, protecting the company from accusations against their selling practices.

In a 2017 interview with Forbes, Upgraded’s founder and CEO, Sandy Khaund, explained how the blockchain can enhance digitally issued tickets, saying:

“Tickets are static. If the game time changes from 2 p.m. to 7 p.m., there’s no way to tell ticket holders. The other problem is it’s easy to fake tickets. If you buy them on Craigslist, you don’t know if the seller printed out a dozen PDFs of the same ticket and sold them to other people.”

Khaund also explained that ticket sellers historically have not had a singular ledger to track and monitor ticket sales, equating his company’s product to a ticket-based version of digital currency:

“The issue is that ticket sellers don’t have a digital asset that’s singular. We realized one way the tech world has overcome this is with Bitcoin, which uses blockchain technology. It works like a huge ledger with debits and credits. If I give you a Bitcoin and then try to give a duplicate to someone else, the ledger says I can’t. I thought, we need that for tickets,” he said.