Overstock’s Medici Ventures invests in wine futures blockchain

October 05, 2018
Chris Wheal

Medici Ventures, the venture capital arm of online retailer Overstock.com, has announced its strategic investment in VinX, an Israel-based wine futures trading company.

Fine wines are to be tokenised on a blockchain

Financial details of the investment were not published, but Medici said the move would help fund the creation of a token-based blockchain platform to help streamline wine futures trading.

Reducing fraud

The platform will also help reduce fraud in the market for wines as investments, where the counterfeiting and relabelling of inferior wine and passing them off as vintage bottles, is common.

Indeed, it is estimated by wine experts that up to 20% of all wine in the world has counterfeit labelling, and even the most-seasoned wine collector or investor cannot identify fakes.

The new distributed ledger system will help track the product’s provenance from vine to wine rack, connecting wine lovers and investors directly with wineries and eliminating potentially fraudulent agents within the industry.

Tokenising wine futures

“VinX’s steps in tokenising wine futures while allowing wine enthusiasts to know without a doubt that the bottles they purchase are filled with authentic wines will position the entire industry as a model of a new global economy that replaces old boys’ networks with frictionless trust through technology,” says Patrick M. Bryne, chief executive and founder of Overstock.com.

Jacob Ner-David, VinX chief executive and co-founder says the company will register all wine futures as tokens on its blockchain which can be redeemed at any point for a proportional basket of wine futures held by the reserve. Listing fees from the wineries go into the VinX reserve.

He adds: “VinX is democratising the capital structure of the wine industry by bringing consumers in direct contact with producers early in the wine-making cycle.

“In addition, we are bringing a powerful validating force that will go a long way toward reducing fraud.”

Walmart takes similar steps

Many companies are experimenting with blockchain as a solution in providing supply-chain details in the food and drinks industry to trace the provenance of goods and ensure genuine products reach the shelf, having been handled appropriately throughout every process of the supply chain.

Last month, an outbreak of e-coli food poisoning traced to lettuces sold by Walmart, prompted the retail giant to create a blockchain to trace the origins of fresh fruit and vegetables sold at its stores.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

Related News

OpenLedger DEX. Temporary Suspension Of Activity December 02, 2019
XMR Gateway Temporarily Disabled December 02, 2019

Leave a Reply

Your email address will not be published. Required fields are marked *