Crypto trend: NFT for wine and whiskey


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NFTs – non-fungible tokens – have been in tears this year. The term was even named by Collins’ Word of the Year 2021. Although they initially caught the interest of the art world (Christie’s sold Beeple’s NFT for $ 69.34 million in March), they are not limited to space. And now the wine and spirits industry wants a piece of the crypto pie, too.

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NFT trade reached $ 10.7 billion in the third quarter of 2021, an increase of more than 700% from the previous quarter, according to a report by blockchain analytics firm DappRadar.

“Rare works of art – and rare bottles of wine and liquor – have been collected and traded for centuries,” Alex Salnikov, co-founder and product manager at NFT Rarible Marketplace, told GOBankingRates.

“But until recently, a fully digital economy of ownership and exchange did not exist. NFTs allow this new system for any passionate person to open up new financial and creative avenues for collectors of rare objects. As the digital world evolves, NFTs have also developed utilitarian components, allowing consumers to enjoy experiences associated with their collectibles, ”he added.

For example, BlockBar, an NFT marketplace that connects consumers and collectors with luxury wine and spirits brand owners, will sell a limited edition NFT with a set of the Dalmore Decades No.4 collection on December 7. .

“The NFT corresponds to the physical bottles stored in the premises of BlockBar in Singapore. These NFTs can be “burned” or traded for the physical bottle they correspond to or resold as an investment vehicle through the blockbar.com marketplace, ”Dov Falic, founder of BlockBar, told GOBankingRates.

This BlockBar platform asset-backed NFT benefits the buyer by ensuring the authenticity and verification of ownership, as well as providing a storage solution and handling insurance, he added. . The winning buyer will have the option to pay in crypto or fiat and will not have to ship the collection until they wish to receive it, anywhere in the world. The other option is for the buyer to list the collection for sale on blockbar.com marketplace so that all collectors can purchase it without the physical product leaving our storage facility.

“In short, the NFT serves as proof of authenticity, verification of ownership and the right to retrieve the collection at any time,” he added.

And this trend is growing rapidly. On December 2, Robert Mondavi launched the Robert Mondavi Winery x Bernardaud NFT Collection, an offering addressing the global problem of counterfeit wine using a scannable authentication system, according to a statement.

Michal Cymbalisty, co-founder of decentralized exchange Domination Finance, told GOBankingRates that the trend is accelerating because “it’s all about ownership.”

“In the same way that artists and creators can open and own their digital galleries with proof of ownership via the blockchain, alcohol enthusiasts can create their collections via NFTs,” Cymbalisty said. “This is where digital assets meet the real world. What could be better than owning a rare and highly coveted bottle or barrel of alcohol? Possess a one-of-a-kind token that proves that you are the owner of the alcohol in question. These NFTs also allow you to easily show off your collection.

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Another advantage of buying NFT of wine and whiskey

A key benefit for investors is that they can buy and sell NFTs of collectible wines and whiskeys without ever owning or physically storing the bottles themselves, Cymbalisty explained.

“To take it a step further, if these NFTs are split up, it could allow larger groups of people to invest in or speculate on rare bottles that they might not otherwise be able to afford,” he said.

And that’s exactly what happened with Blockbar’s November sale of a limited edition NFT tied to a rare barrel of Penfolds Magill Cellar 3 wine made from the 2021 vintage, which was sold to a small group. investors in 12 seconds for $ 130,000.

Alex DiNunzio, co-founder and CEO of Jambb, a digital comedy collectibles startup giving comedians the ability to create additional revenue streams from their content through NFTs, echoed the sentiment, saying that “Collectors not only buy NFTs of the whole product, but are able to buy part of it with splits.

“It allows people who would not normally be able to participate to participate in the action and to engage more deeply with their favorite brands,” he said.

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Are these investments worth it?

As to whether these investments are worth it, several experts note that they should be viewed in the same light as the art collection.

“For centuries, collectors have been able to store their wealth and watch it grow in value through works of art, fine wine, whiskey, collectibles, etc. in value via an NFT or digital asset “While we cannot give specific investment advice, being alongside the next wave of digital provenance and asset ownership through NFTs has proven to be useful for many . “

An added benefit is that through ownership of digital assets, people can trade, store and sell collectibles profitably and securely using blockchain technology, as NFTs make it possible to utilize the value of digital assets from within. ‘a way that makes sense for collectors. and connoisseurs of fine wine, according to Tobias Batton, CEO and founder of blockchain game publisher Ex Populus.

“For example, if a collector owned a bottle of French 1947 Cheval-Blanc and wanted to see its value – approximately $ 304,000 – redistributed via an NFT, that NFT can be used to exchange for the value of other items, stored in completely safe without the risk of theft and even becoming split so that it belongs to a community of collectors instead of just one person, ”Batton told GOBankingRates.

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Is buying NFT wine and whiskey a fleeting trend?

But is the future of an NFT wine or whiskey instead of a good bottle a trend that will continue? According to several experts, the answer is yes.

Batton said the future and use case possibilities for Web3, DeFi, and NFT are unmatched.

“It is entirely possible that we are witnessing a world where the donation and sharing of digital assets is becoming the everyday norm. These bottle NFTs add utility for scarce and expensive alcohol, and it would be much easier to give someone an NFT than to wrap a flimsy bottle. However, if you are planning to drink alcohol, the NFT is not worth anything because it loses its value when the physical asset does, like when you open a bottle of vintage wine, ”added Batton.

And brands will also continue to capitalize on the new revenue stream.

Salnikov of Rarible, said that while NFTs will not replace the traditional sale of alcohol, “I anticipate that we will continue to see more alcohol brands expand into the crypto market through NFTs, as the engagement with blockchain technology remains on the rise. “

Other benefits you get when you buy these NFTs

In addition to what brands can offer through blockchain technology, including authentication, security and provenance, alcohol NFTs offer ‘an experience’.

An example can be a French winemaker selling bottles of wine equipped with NFT, featuring a QR code that unlocks a personal video of them talking about the provenance and history of the place of origin of the wine, and why this bottle of special wine has special meaning and value, said Salnikov.

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“This NFT could also unlock an invitation to an exclusive dinner or wine tasting session hosted by the winery, for example – while serving as proof of ownership stored on an immutable public ledger,” he added. “NFTs are already starting to facilitate a consumer experience never before possible, while the technology will present many unique use cases as it evolves. We expect him to completely transform the concepts of brand loyalty and consumer trust and we are excited to be a part of that change. “

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About the Author

Yael Bizouati-Kennedy is a former full-time financial journalist and has written for several publications, including Dow Jones, The Financial Times Group, Bloomberg and Business Insider. She has also worked as a vice president / senior content writer for large New York-based financial firms including New York Life and MSCI. Yael is now a freelance writer and most recently co-authored the book “Blockchain for Medical Research: Accelerating Trust in Healthcare”, with Dr Sean Manion. (CRC Press, April 2020) She holds two master’s degrees, one in journalism from New York University and one in Russian studies from Toulouse-Jean Jaurès University, France.

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