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The sale of digital art non-fungible tokens (NFTs) may be waning, but there are countless other players that are exploring new and unique ways to employ NFTs.
What’s an NFT, you ask? Think of it as a way of storing digital records on a blockchain, the distributed ledger technology that underlies most cryptocurrencies. From government benefits to land titles, any form of data can be securely stored on a blockchain.
And what does this have to do with wine? When it comes to fine wine, establishing and proving authenticity is a key objective. NFTs provide an ideal tool for giving winemakers and wine buyers an unimpeachable method for verifying the provenence of individual bottles.
Forbes Advisor spoke with Alfonso De Gaetano, founder of Crurated, about the future of wine NFTs. Crurated is a blockchain-based wine membership program launched in 2021 that bridges the world of NFTs and investing in rare wines.
Crurated recently launched an exclusive partnership with the well-regarded French winemaker Charles Lachaux. Under the partnership, Crurated members can get access to special offerings like Bourgogne Aligoté, Les Champs d’Argent, 2021, and Côte de Nuits Village, Aux Montagnes, 2021.
Below are excerpts from our interview with De Gaetano, which have been edited for clarity and length.
Can you tell our readers how Crurated works?
Crurated has been built by wine collectors for wine collectors—I’m a big collector myself. I wanted to make something that would be great for all wine collectors.
One of the main issues in collecting is access, and we provide access even if you are new to the world of wine.
Our platform gives collectors the chance to get wines from the top producers—and our platform is always expanding with some of the best names in the world, even though for now, we’re focusing on just Italy and France.
How do you use blockchain in your business? Are there stickers applied to the wine bottles for traceability?
We apply Crurated near-field communication (NFC) labels to every bottle. This technology uses radio frequency identification (RFID) tags—this is what proves the authenticity of the wine.
Each unique bottle of wine is associated with a unique NFC code. And that unique NFC code is registered on the blockchain. We use the Polygon blockchain for our wine NFTs.
This creates a lot of value, by certifying a bottle from the moment that it leaves the seller or the producer.
Can you give us an example of how this works?
We mainly sell lots. We don’t sell unique bottles apart from big formats like Magnum, Double Magnum, and so on.
All the bottles we sell get NFC labels. Any client who buys on our platform can see where each bottle of their lot is located, now at the warehouse, now in transit.
So once they buy, their bottles are labeled, and they get access to the NFT on the blockchain, and then they can click and ship with whatever they want.
How does using a blockchain help prove a wine’s authenticity?
When I was going to wine auctions and buying as a big collector, you didn’t really know the whole story of any given bottle. Maybe there is some sort of certification, but you don’t have absolute certainty where the bottle is coming from, the producer, its history, or how it got there.
So we are really focusing on the value offered by blockchain technology to address these issues. We see it as very valuable for clients when it comes to the authenticity and traceability of bottles.
With wine NFTs, every step is registered on the blockchain. Ten years down the line, if you buy a bottle from Crurated or from someone else. You can tap your phone and see its entire history.
How many bottles are on Crurated’s blockchain so far?
We’ve applied NFT technology to 25,000 bottles of wine. These are some of the top wines in the world. Next year, we’re planning to create NFTs for at least 50,000 bottles of wine.
Are wine NFTs a better way of handling digital certification?
We are the first wine marketplace in the world to use blockchain technology where it matters, certifying at the scale every single bottle that comes directly from producers into our warehouse in Burgundy, France.
We offer clients full traceability from the moment it leaves the producers’ cellar to the moment it arrives at their own cellar.
I am a strong believer in the functional value of blockchain. Lack of authenticity and traceability are major issues today in the world of wines.
Who is Crurated’s ideal member?
We seek out passionate wine lovers who are looking for access to some of the best wines and wine producers in the world.
We sell a full range of wines from top producers that usually start from 30 euros and can go up to tens of thousands of euros.
What is the future of NFTs as it relates to the wine industry? Do you believe this model is sustainable over time?
It’s undeniable that NFTs have earned a reputation for staggering valuations that have quickly declined. At Crurated, we believe in the value of blockchain and NFT technology beyond the hype.
If you were part of the early days of e-commerce, you might remember the hype surrounding e-commerce companies and the market downfalls that ensued.
Digitally native companies that stayed in the game and strategically leveraged the power of e-commerce to transform online retail across many markets are now driving billions, if not trillions of sales online every year.
The same holds true for the blockchain and NFTs. Beyond commerce and, in our case, wine, they are being used in a number of unique ways. There’s hype, but beyond the hype there is opportunity.
Crurated offers four membership tiers, ranging from a complimentary service to a connoisseur membership at 36 euros per month, a collector membership at 180 euros per month and an ambassador membership at 600 euros per month.