NFT offerings in the alcohol industry are flourishing. One emerging concept is the tokenization of physical bottles, paving the way to verifiable authenticity and rewards gained through NFT ownership.
Certificates of authenticity
As with all rare and fine goods, NFTs help combat counterfeiting in the luxury wine and spirits industry. When each bottle has an NFT attached, real-time tracking and proof of authenticity are possible.
Alcohol brands can work with blockchain certification solutions like Chai Vault to prove the authenticity and provenance of their products. Marketplaces also provide minting services.
A new approach to fine wine investing
A pioneer in this field is BlockBar, an NFT marketplace for fine wine and spirits that connects customers directly with alcohol companies. BlockBar has so far partnered with high-end brands like Glenfiddich, Karuizawa, OFC, and Rémy Martin. These brands reserve limited editions for BlockBar, which mints them as NFTs and releases NFT bottle collections on its platform.
BlockBar enables a whole new way of investing in wine and whiskey. The bottle releases can occur via auctions, on a first-come-first-serve basis, or through a random drawing. Moreover, owners can redeem their NFTs for real bottles and have them delivered to their addresses. Until redeemed, BlockBar secures the bottles in its warehouses in Singapore. Collectors can also trade the NFTs in the marketplace instead of redeeming them.
Ownership also gives additional benefits, such as private distillery tours, exclusive content, special discounts, and exclusive future NFT drops.
Age your bottles first, then redeem
Like BlockBar, most beverage-related NFT projects offer owners the option to redeem NFTs for the actual bottle. Depending on the project, redemption can be immediate or later, allowing the owner to delegate the storage of the wine bottles in a safe place and benefit from the potential price increases during that time.
For instance, Trefethen, a family-owned winery from Napa Valley, offered nine bottles of their award-winning 2018 Cabernet Sauvignon as NFTs. The winery will store the wine bottles in its inventory for up to 10 years on behalf of the NFT owners from select countries.
Not just bottles
The beverage-related NFT applications are not limited to tokenizing the actual bottles, though. Using smart contracts, alcohol companies can build a variety of creative experiences for their customers.
As important components of popular culture, NFTs are the gateway to establishing relationships with young generations. Some brands have NFT offerings, but they’re not linked to physical beverages; instead, they mainly capitalize on the web3 culture.
For instance, each NFT offered by Clive’s, a Victoria-based cocktail bar, includes a recipe as unlockable content and grants access to digital experiences, special tastings, and AMA sessions with the bar’s world-renowned bartender.
Another project worth mentioning is NFT Wine Club which is building an exclusive wine club in the metaverse.
The world-famous lager producer Budweiser is building its own metaverse Budverse where NFTs give special perks. For instance, each Budverse Cans Heritage NFT functions as an entry key to the metaverse and unlocks exclusive rewards.
Everything on the blockchain is poised to gain additional financial benefits
NFTs can be a powerful financial tool for wineries. Just like artists receive ongoing royalties from every secondary market NFT sale, the winery that issued the bottle originally can continue earning royalties from every trade if encoded into smart contracts. In the case of Blockbar, for example, 10% of the royalties is split between the marketplace and the winery.
And some initiatives carry DeFi opportunities to the world of grapevines. For example, WiV works to improve the wine trading market by incorporating blockchain technologies. The company is building a decentralized wine fund that will lower the barriers to wine investment. Additionally, NFT owners can earn yields and use their wine collections as collaterals to take on DeFi loans.