A Chinese startup is using blockchain to spot fake wine

A Shanghai-based startup is using blockchain technology to stop the spread of counterfeit wines by verifying the supply chain sequence, according to a report in South China Morning Post.

The startup, VeChain, is working with retailer Shanghai Waigaoqiao Direct Imported Goods (DIG) and testing the products of French winery Pierre Ferraud and Fils on its blockchain platform. 

If customers want to verify the wine being sold, they can scan a barcode on the label of the bottle to get details about the supply chain, which  includes an 18-digit Chinese customs declaration number.

“The beauty of blockchain is that shoppers can see information about the whole life cycle of a bottle of wine from various sides, including vineyards, logistics and retailers,” Fu Yu, a partner at VeChain, was quoted as saying.

Yu said that for more premium brands, it has integrated a NFC (Near Field Communication) chip in the cork of the bottle for verification. If the chip is broken, then the bottle cannot be verified.

The Chinese wine industry is said to be worth nearly $3 billion but most of the wine consumed in the country is fake.
Last year, the startup had signed an agreement with French winemaker Beaujolais Nouveau to deliver authentic red wine using the distributed ledger technology.

The report said that more than 10,000 blockchain-tracked wine bottles have been shipped to DIG and this number might go up by three times in the next year. The startup has been speaking to Italian, Australian and South American vineyards to increase its foothold in the market.

Fu also said that VeChain is engaged in negotiations with an Italian vineyard about utilising blockchain to establish a foothold in China. The same offer has also been made to wineries in Australia and South America.

A number of major brands including Nestle, Walmart and Chinese retailer JD.com are experimenting with blockchain to secure their supply chain. 

Earlier this year, beverage major Coca-Cola Co launched a project using blockchain to create a secure registry for workers that will help fight the use of forced labour worldwide.