Chai Wine Vault

Chai Wine Vault Powered by Everledger

Maureen Downey and Everledger have joined forces to launch the Chai Wine Vault, an unprecedented solution for securing the authenticity and provenance of fine wine.

Everledger is a trusted, global ledger used to track and verify the provenance of valuable items. A proven leader in the diamond industry with 1,000,000 stones currently secured on the blockchain, Everledger is now extending the platform’s technology to create a digital wine vault to solve the problem of counterfeit bottles in the fine wine industry.

The first to apply Everledger’s technology in the wine space is Maureen Downey, the renowned “Sherlock Holmes of the fine wine industry”, recognized internationally for her expertise in combatting counterfeit bottles.

Wine authenticated through The Chai Method® (TCM®) is certified on the blockchain, creating a permanent, digital record of provenance that can be accessed throughout a bottle’s lifetime journey. 

Wine certified on the Chai Wine Vault has a guarantee of authenticity, ensures buyer confidence and protects the future investment value of wine assets for centuries to come.

Download the Chai Wine Vault Press Release.

Chai Wine Vault by Everledger – How it Works

 

Moe SG

Chai Wine Vault certification is revolutionizing wine authentication and provenance tracking for the fine wine industry by ensuring the protection and future value of wine investments in a secure, immutable, incorruptible and timeless digital vault. Authenticity and provenance data including detailed notes and photographs, the bottles’ unique ID, or “thumbprint,” and a virtual inspection certificate exist in the blockchain, and can be kept private or made public for marketing purposes.

Wine producers, licensed vendors of bottles purchased with direct provenance, and bottles authenticated by TCM Certified Authenticators, are certified on the blockchain, by being inputted into the Chai Wine Vault by Everledger, creating a permanent, digital record of provenance that can be accessed throughout a bottle’s lifetime journey.

We have created an anti-Coravin solution so that once a Coravin, or needle has permeated the closure, the ID is affected and the bottle’s ID will not check-in properly when verified for the next transaction. Unfortunately, Coravins have been reverse engineered to empty and refill bottles with perfectly intact packaging, including anti-fraud devices. Using a exclusive, multi-layered, first of its kind, tamper proof technology by Bowater, this final piece of the bottles unique ID secures all bottles that have been certified at the time of production, bottles which have been inputted by licensed vendors that have provable (via paperwork) direct provenance, or that are authenticated in the secondary market for. The Chai Wine Vault can also layer on top of existing technologies.

Chai Wine Vault certification details of the authentication and provenance can remain private or be made public by the owner to be used for marketing and sales purposes as long as the bottle matches the matrix stored as its unique ID, or “thumbprint” in the blockchain. As the bottle changes hands, provenance information can be updated, provided the transaction occurs by a licensed user. Licensed brokers, retailers, auction houses, and other sales platforms can link to the unique bottle’s information in online catalogues and offerings to show the authentication information to potential buyers, for the life of the bottle, verifying the provenance and thus raising the value of the bottle, and the value of the collector’s investment for decades, or generation to come.


Wine is a Valuable but Fragile Asset

  • Fine Wine is a proven valuable asset which, when purchased correctly will increase in value over time.
  • As a “perishable asset,” Fine Wine is an excellent way to share wealth from generation-to-generation.
  • The market is infiltrated with counterfeit bottles, and more are being made and put into markets every day.
  • Counterfeit bottles are almost always accompanied by counterfeit provenance stories to substantiate them. Many times, the provenance stories are believed and the counterfeits are sold, even by reputable merchants.
  • Currently, bottles that are authenticated are more valuable in the short term, but must be re-authenticated every time they are traded.
  • Collectors that have purchased fine and rare wines in the last 15-20 years need to have their bottles authenticated to ensure they are not sitting on valueless investments.
  • Wine is alive, and fragile. Quality and longevity are directly affected by a bottle’s unique transit and storage history. Thus, provenance is just as important as authenticity.
  • Authentic bottles with provable provenance are worth 20-40% more than equivalent bottles without the same known provenance, as evidence by the results of ex-chateau, and importer sales at auction.
  • While many producers have made great efforts to put technology in their packaging, many of those technologies are being worked around, and will be used to substantiate counterfeits in the future.
  • The only way to ensure the protection of wine assets is a solution that will address both authenticity and provenance, that is complex, and layered, cannot be physically duplicated with improved technology and which is incorruptible and timeless: Chai Wine Vault by Everledger.
  • Fine Wine Bottles authenticated and certified in the incorruptible blockchain based database, Chai Wine Vault by Everledger are, and will become, more valuable for decades, and generations to come.

 

Counterfeit Wine: The Sad State of the Fine Wine Market

There is no way to accurately state the dollar amount of counterfeit wine circulating in the world’s fine wine markets today. But there is evidence that it could easily represent over US$1billion circulating in current markets. Between 2002-2012, Kurniawan created and sold over US$150million in counterfeit wine. That represents over US$550million of current market value in global wine markets, and almost all those bottles are still in collections, or are still being returned and resold. And he is just one known counterfeiter.

Opportunists in Europe, Asia and the USA have viewed the very lucrative outcome of making and selling counterfeit wines, recognized the low risk involved due to few prosecutions, and have taken up the trade. This has spawned a new wave of counterfeiters who are flooding the markets. This is not about clearing the Kurniawan, Rodenstock and bottles from other already known counterfeiters, we also have new counterfeiter’s bottles being discovered all the time. In fact, a top wine expert in Hong Kong who advises collectors, in response to the news of the Oct 7, 2016 arrest in Marseille, of fraudsters selling counterfeit Dugat-Py, Roumier and Rouget, Burgundy wines, responded in an email:

“I suspect this is the tip of the iceberg. The volume of suspect wines I am seeing coming out of Europe is at Rudy Kurniawan levels.”

Unfortunately, many counterfeit wines pulled out of circulation and returned to the vendor because of inauthenticity for a refund, are simply resold as authentic by those vendors to the next unsuspecting buyer.

 

Wine Fraud, and counterfeit wines have become a costly, endemic problem that affects all buyers and vendors of fine wine in the global marketplace. Counterfeits cost people money, jobs and livelihoods. 

  • Counterfeit wine accounts for some 20% of international sales. Source: Sud Ouest
  • According to the International Center for Alcohol Policies, 30% of all alcohol that is consumed is fake. Source: Wine-Searcher.com
  • More than 50% of Chateau Lafite sold in China is fake. Source: Xinshi Li, President of the Chinese Academy of Inspection and Quarantine
  • 7000 cases of fake Lafite, Mouton, Latour and other well-known Bordeaux wines retailing for a total of 32 million dollars were found in a single 2013 raid in China. Source: the Cellar Insider
  • 75% of Canadian Ice Wine sold in Asia is fake. Source: Rhys Pender, MW
  • The value of just one convicted counterfeiter, Rudy Kurniawan’s counterfeit bottles in the market today is over $550mill, and those bottles are all still being circulated. Source: Maureen Downey
  • On average, over 2 wine crimes involving wine fraud or theft happen each week. Source: WineFraud.com

 

Chai Wine Vault by Everledger: Finally THE Solution to an Age old Problem

Until today the only formal reporting an authenticator of fine and rare wine could prove beyond a shadow of a doubt was a counterfeit.  In the hands of an experienced authenticator a fake bottle of 1982 Petrus – and in fact there are more fake bottles of this famed wine circulating than real bottles ever produced by the Chateau; can be spotted, and positively identified as a phony.  But being able to certify that a bottle is “authentic” is a much more difficult challenge.  The moment the authenticator and the wine part, the condition of the bottle is subject to change.  It could be sold to another owner, consumed, refilled or altered in any number of ways.  In other words, authentication until now, could not be proven past the moment of the authentication.

Today with the announcement of the Chai Wine Vault by Everledger, there is finally a way to prove the positive. 

Wine authenticated through The Chai Method (TCM) is certified on the blockchain, creating a permanent, digital record of provenance that can be accessed throughout a bottle’s lifetime journey. Maureen Downey, owner/founder of Chai Consulting LLC, a world renowned authenticator of fine and rare wine, searched for years for this solution.

“Wine certified on the Chai Wine Vault has a guarantee of authenticity, ensures buyer confidence and protects the future investment value of wine assets for centuries to come.”

Consumers and buyers of fine and rare wine now have a complete solution to ensure the provenance of every bottle of wine they buy or sell.

 

Everledger

Everledger is a trusted, global ledger used to track and verify the provenance of valuable items. A proven leader in the diamond industry with 1,000,000 stones currently secured on the blockchain, Everledger is now extending the platform’s technology to create a digital wine vault to solve the problem of counterfeit bottles in the fine wine industry.

 

Leanne Kemp of Everledger

Leanne Kemp is the founder & CEO of Everledger – a digital, global ledger that tracks and protects diamonds and other valuable items on their lifetime journey.

With a wealth of successful startup companies under her belt, Leanne is pushing boundaries in protecting the global market of diamonds and luxury goods.

Using her extensive background in emerging technologies, business, jewellery and insurance – Leanne and Everledger are working towards ensuring global transparency by constructing a digital verification system that assists in the reduction of fraud, black markets and trafficking.

Everledger is leading the market in real world application of blockchain technology with a set of industry awards including the Meffy Award 2015 for Innovation in FinTech, FinTech Finals 2016 for Best in Show, European Financial Tech Awards 2016 for Best Blockchain Company, Asia Insurance Technology Awards 2016 for Best Newcomer and Penrose Award for Innovator of the Year.

 

Note from Maureen Downey:

Since getting involved with culling counterfeits from the market in 2000, I have heard many ideas on fighting this blight. I have seen several laughable efforts as well as many great, but unfortunately unsatisfactory solutions to solving the counterfeit bottle fraud on the global markets.

As time has progressed, so have the sophistication of the counterfeits, and so have the outcries from collectors, producers, and reputable vendors for a solution to certify bottles they deal with as authentic and from trusted provenance.

To date no technology nor single solution has been successful. And authentication is only a solution that is useful for more than a single transaction. Each time a bottle is traded, it is represented as a new entity: it is inspected as a new entity and questioned as such, as it should be – because there is no immutable, incorruptible database where information about that bottles exists. And it could after all, have been altered, emptied with a Coravin or a skillful ahso user, and refilled with 2002 Liberty Bay Cellars Merlot. (Rudy Kurniawan’s base wine for old Pomerol.)

At every turn, I have been underwhelmed by the technologies available as they either fail with time, like Prooftags that peel off with a few years in a humid cellar, or they will simply be fodder for substantiating counterfeits of the future as they are 3-D printed, as will the myriad of single solution, RFID technologies that have been proposed as the saviors of wine authenticity. The problem is, all of these “high tech” solutions will be easily counterfeited themselves in the years to come when we need the authentication the most. It has been very frustrating. 

Until now.