Overstock Subsidiary Medici Ventures Invests In Wine-Tracking Blockchain Startup VinXbr>
Medici Ventures, the blockchain branch of retail giant Overstock, has announced a strategic investment in a blockchain startup VinX, which is developing a blockchain platform to streamline wine futures trading.
VinX is building a token-based digital wine futures platform based on the Bordeaux futures model that will enable thousands of wineries to streamline funding by selling wine futures and developing direct connections with their consumers. The goal of the platform is to reduce fraud in the wine industry by using blockchain technology to track provenance of wine to end consumer at a cost bearable to the industry.
According to fraud experts, 20 percent of all wine currently circulating the globe is fake. To combat this growing concern, VinX is planinng to connect consumers directly with wineries using blockchain to eliminate fraudulent middlemen within the industry and provide wine lovers with a direct line to the source of the products.
“Like any economy, the wine industry has difficulty scaling its middlemen-heavy systems in parallel with the growing demands of an increasing global market,” said Patrick M. Byrne, CEO and founder of Overstock.com. “VinX’s steps in tokenizing 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.”
Jacob Ner-David, VinX co-founder and CEO, said that his company is democratizing the capital structure of the wine industry by bringing consumers in direct contact with producers early in the wine-making cycle.
“We are riding the wave of direct-to-consumer, which Overstock has been a leader of for almost 20 years,” said Ner-David. “In addition, because we are registering all wine futures as tokens on a blockchain, we are bringing a powerful validating force that will go a long way toward reducing fraud. VinX looks forward to benefiting from the many years of e-commerce experience of Overstock and the blockchain leadership of Medici Ventures and the rest of the Medici Ventures portfolio.”
VinX is expected to launch a pilot beta program of its blockchain platform with first-adopter vintners and distributors in Q1 of 2019.