Overstock's Medici Ventures Backs Firm Tackling Fake Wine With Blockchain

Medici Ventures, the blockchain accelerator and subsidiary of Overstock.com, has made a seven-figure investment in blockchain startup VinX. Israel-based VinX is developing a supply chain platform for trading wine futures, which allow connoisseurs and collectors to purchase a vintage while it's still in the barrel, a year or two before it's bottled and released on the market.

By registering these futures as tokens on a blockchain, the startup believes it will be possible to follow the wine to its origin and cut out the fakes that plague the industry.

"There are a lot of middlemen in the wine industry that can be eliminated with blockchain, there is a lot of problems with counterfeits. We also think this technology is democratizing the purchase of wine."

With a $302 billion global wine market and up to $3 billion paid by customers for counterfeited products, VinX is aiming for big game.

It's not the only firm making a move to put wine on a blockchain, however.

Chainvine, a Swedish startup with a similar vision, raised $3 million this summer, and Everledger, known for tracking the provenance of diamonds, claimed two years ago to have registered the first-ever bottle of wine on a shared ledger.

In a statement, Ner-David framed his company's mission as aligned with that of Overstock, the e-commerce giant founded in 1997 by Patrick Byrne, who later became a prominent evangelist for bitcoin and blockchain technology in general.

Medici has previously invested in a number of blockchain businesses, including Voatz, Ripio, Symbiont, Bitsy, Bitt, Factom and others.

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