A Washington state winery with tech connections is getting into the NFT game with a sale of three unique digital artworks commemorating the release of a limited bottling of a cabernet sauvignon. While fine wines largely appeal to an older crowd, the NFT tech phenomenon skews younger.
“It’s a way to generate interest from a segment of people who maybe would not have known about the wines,” said winemaker Andrew Januik.
The artworks are animated versions of the label for Januik’s Baba Yaga wine — so named for a fabled witch who resides in a house perched on chicken claws. The question now is whether potential buyers will see the value of the NFTs, or write them off as a fantastical tech vision with little more than poultry legs to stand on.
A similar experiment seemingly paid off earlier this month for Yao Family Wines, a Napa Valley winery founded by retired basketball star Yao Ming. The winery auctioned off what it claimed was the first pairing of bottles of wine with an NFT. Among the winning bidders was billionaire entrepreneur and NBA-team owner Mark Cuban.
NFTs, or non-fungible tokens, have become a craze among some collectors as well as cryptocurrency and blockchain enthusiasts. The tokens are issued as virtual certificates of ownership that are recorded as part of a blockchain computing network. NFTs have been sold for gaming Cryptokitties, Twitter founder Jack Dorsey’s first tweet and an image of a New York Times article. And each day seems to bring news of another staggering sum paid for a random bit of internet history.
Like the Yao Family Wines auction, Januik is planning to offer a signed bottle of Baba Yaga wine and an in-person or virtual wine tasting along with the NFT, hoping that including something a bit more tangible will add to the draw.
Januik, who is in his early 30s, is the son of Mike and Carolyn Januik, who own the Januik winery. Andrew Januik launched his own label in 2011. The Woodinville, Wash.-based winery runs in partnership with Novelty Hill winery, which is owned by Tom Alberg and his family. Alberg is a co-founder of Seattle’s Madrona Venture Group, a leading venture capital firm.
Januik said it took him a couple of tries to explain the NFT concept to his dad. He finally told him, “just think of it as a virtual baseball card. I think he thinks it’s a little silly.”
Alberg, who was an early investor in Amazon and served on its board for 23 years, is also a bit unsure about NFTs in general.
“Cryptocurrencies are real and important, but we don’t yet know the long-term significance of NFTs,” said Alberg, who wondered if they’re just a fad. “Seems like a financial bubble, but I think will have staying power, including in ways we haven’t yet realized.”
Januik said they’ll start promoting the NFT sales this week. He and cellar master Grady Kenealey, who created the digital artwork, see the effort more as a marketing tool than a big moneymaker. They’re going to offer the NFT, signed bottle and wine tasting for 0.18 Ethereum, which is currently worth about $450.
The winery might offer more NFTs in the future, but would likely restrict sales to once or twice a year and for limited numbers of artworks. That’s due in part to the environmental impacts of the tokens. As they’ve been gaining in popularity, people are raising concerns about the carbon emissions associated with the computing power required by the blockchain.
Most NFTs, including those sold by Januik, are part of the Ethereum blockchain. It’s smaller than the better-known Bitcoin blockchain, but requires similar, energy-intensive processes to run. Digiconomist estimates that a single Ethereum transaction uses as much power as the average U.S. household over more than 2 days.
“Those are things that we do take into consideration,” Januik said. “We’re an industry that’s more or less 100% dependent on the environment and that is important to us.”
