Tokenize, Trade, Drink!

We have just uploaded on our website a new version of our White Paper, reflecting our new B2B business model (see this post for details). In the paper we discuss Unique Asset Tokenization (UAT), i.e. the process of linking a unique asset, either digital or physical, to a single non-fungible token (NFT). Unlike fungible tokens, each NFT is unique and non-divisible, with specific attributes. For this reason, NFTs are well suited to represent whole ownership of unique assets.

UAT is relevant both for strictly personal assets (e.g. ID documents or medical records) and for tradable ones. UNICO is focusing on the latter - examples include software licenses, digital collectibles, in-game items, e-tickets, gift cards, as well as houses, works of art and other valuable physical goods.

A very interesting use case is the global wine market, worth about $300 billion. The fine wine segment has been attracting investors for several years, with average annual returns in excess of 10%. The secondary market in this segment is worth $5 billion/year (source).

Fine wines are mostly traded between professional dealers, based on standard wine cases (holding e.g. 12 bottles), although some Ebay-like online platforms enable retail investors to trade their own wine.

In order to boost the retail secondary market, one has to tackle the pain points of standard online marketplaces namely expensive and unsafe payment procedures, room for fraud, goods’ quality not guaranteed.

We believe UAT on the EOS blockchain can address all such points and add significant value and liquidity to the market, based on the following strategy:

• Each tradable wine case (or individual bottle, for the most expensive ones) is linked to an NFT,
• As long as wine cases are kept in safe custody in approved cellars, they can be traded on a decentralized exchange via their NFTs,
• At any time, whoever is holding the NFT in their wallet can request physical delivery of the wine, which removes the NFT from the secondary market.

The synergy between UAT and third-party custody streamlines the online trading process and can potentially increase the liquidity of any high-value physical item. Gold bullions, diamonds and works of art are obvious additional candidates for UAT.

UNICO is currently discussing partnerships in the wine market and in other high-potential markets. We are working to deliver via UAT an EOS-based, secure Ebay competitor for premium goods.