Wiv.io: are NFTs the future of wine?
As old as the world itself, wine has been an important cultural experience throughout human history – from worshiping the gods of wine in ancient times to what is now a multi-billion dollar market. In 2019, the global wine market size was 364.25 billion and is predicted to reach 444.93 billion by 2027.
Besides being a trophy for the community of collectors, fine wine is also an excellent alternative investment option. It shows impressively stable prices and is less volatile than other assets.
However, investments in wine and trade are still treated with caution by investors as there are some obstacles; Proving the wine’s provenance, transportation, storage and high costs make the wine trade a challenge.
Since the crypto era has already arrived in the art world with the revolutionary non-fungible token (NFT) technology, the question arises: what can it offer the old wine industry? Could this be the answer to the modernization of the wine trade?
The archaic industry is going tech
Tommy Nordam Jensen, CEO and co-founder of WiV Technology, acknowledges wine’s outstanding performance in the investment environment in an interview with DailyCoin.
“Wine is a great asset to get in terms of rising price over time. Wine as an asset is one of the best performing alternative assets. Wine outperformed stock markets, real estate, classical art and so on, so it has about 240% growth over ten-year periods,” says Jensen.
Given the long history of the wine industry, digitization processes are slowly entering the market. According to Jensen, only 5% of all wine is traded online.
“The industry itself is very old. It has been going on for hundreds of years and so the trade and many processes today are the same as they were 300 years ago, it hasn’t changed much,” Jensen noted in an interview.
WiV Technology is currently on a mission to bring crypto to the wine world. The company works with wine producers, distributors and merchants around the world to bridge the gap between archaic and new markets.
On the blockchain-based WiV platform, each bottle or case of wine is associated with a unique non-fungible WiV token, just like each bottle of wine. These tokens can be traded quickly and transparently on NFT marketplaces. Jensen stated that
“We strongly believe in it and we are building something unique in terms of the approach there and also the whole kind of usability of the wine. Decentraland, Cryptobox or the Sandbox are the future when it comes to digitizing real-world assets, such as wine, and you have to play to present, sell and exhibit physical wine in the metaverse.”
Direct proof of wine provenance
One of the most important aspects of investment wine is its provenance and how it has been stored, which determines its value.
The approval of the origin of the wine involves a huge amount of paperwork that must be checked manually at every step of the process, which slows down the trade potential.
Blockchain technology and tokens are excellent solutions to keep track of wine ownership. Decentralized structures make it virtually impossible to fraudulently claim ownership of a tokenized asset.
The blockchain contains information about the wine, which is stored and verified worldwide in small packages. If any of these little packets are changed, it’s obvious in the chain, where information doesn’t fit, and the changes will be rejected.
It means buyers and sellers can rest assured that their investment is authentic and protected from fraud. By withdrawing paper documentation, transactions can be completed almost immediately.
Fixed wine transport and storage issues
Another consideration for wine investors is the logistics and storage of their collection. NFT solutions for the wine trade remove this obstacle to make the processes of wine trade faster and more progressive.
Investors no longer have to worry about the transport or specific storage conditions of their wine. Instead, they can hold a token that corresponds to a bottle or crate of wine and guarantees the authentication of their wine collection.
When wine is resold, only the NFT is moved. Holding digital wine assets is not only a great way to guarantee provenance, but it also reduces the risk inherent in wine collecting. There is a direct correlation between the number of times a wine bottle is moved and the potential damage. A few minutes in a warm place can seriously affect the value of the wine.
Act cheaper and faster
The WiV platform makes it possible to trade ownership of wine assets faster and at a lower price than was possible in the traditional market.
Blockchain technology is introducing changes in the way the trading process is managed. Blockchain has no central authority to maintain its integrity, reducing the need for brokers and the associated costs. Therefore, investors have significantly less costs at the end of the day.
These conditions are necessary for the growth of a much more liquid market than in the past. Tokenization is attracting a new generation of wine investors looking to add fine wine to their portfolio as a liquid asset.
Investing in wine via the WiV platform offers the best of both worlds: the efficiency, transparency and speed of a digital market, with the history and establishment of a physical product.
On the other hand
- The main challenge facing WiV is the archaic market, which may not be ready to go digital as a typical wine investor may not be equipped to navigate a digital world.
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