Cash, card or Bitcoin? How luxury brands are ramping up the exclusivity by giving crypto’s overnight millionaires new ways to spend their digital cash

Cryptocurrency has been making waves in the world of investment in recent years, but has left many feeling baffled as to how and when it can actually be used in a real-life setting. Whilst those in the know have continued to place their trust in its future prospects and turned tidy profits as a result, your average Joe on the street would be unlikely to ever encounter cryptocurrency in their daily lives. But behind the scenes, Bitcoin has been slowly but surely making its way into the mainstream, and in particularly, the luxury market.

Now prevalent in a number of unexpected settings, the blockchain technology behind it is increasingly being used to securely authenticate luxury goods such as high-end cars and watches – and an increasing number of products and services can now be paid for in Bitcoin, too.

Take, for example, Swiss watchmaker Hublot’s Big Bang watch, which was one of the first made available for purchase only by Bitcoin. The limited-edition, £20,000 model was up for pre-order exclusively through a partnership with digital brokerage firm Octagon Strategy Limited (OSL). At the time, it seemed this might have been little more than an attention-grabbing gimmick – but the mover paved the way for other lavish brands to follow suit, adding an extra level of exclusivity to their wares which makes them all the more covetable to wealthy, investment-savvy buyers.

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Hublot launched a 210-piece limited edition and the first watch in the industry that can only be purchased with Bitcoin. Image credit: BCFC/Bigstock.com

In many cases, this means a younger and financially shrewd market – many of whom have become overnight millionaires by taking a risky punt on bitcoin early on using signalling sites such as Bitsignal, before value soared by more than 1,960 per cent in 2017. Although Bitcoin value is now much lower, those who sold quickly at the time were quids in – and set up financially for life.

For Hublot, it seemed the move towards bitcoin transactions only paid off – the Big Bang watch was almost immediately over-subscribed. And since then, a number of other watchmakers have followed suit. Others, including Ulysses Nardin and Breitling, have been making use of the blockchain technology behind Bitcoin to facilitate authentication of all of its watches in a bid to cut down on counterfeits and fakes, instilling confidence in their buyers that they are always getting the real deal, even when purchasing vintage or second-hand timepieces from elsewhere.

Thousands of people are using cryptocurrencies to improve their standards of living

Just as with investing in cryptocurrencies, using them to facilitate transactions is a potentially risky business, but executives at Hublot said at the time that they had solved the issue of currency fluctuations with a hedging mechanism. Since the watch’s price was already set in dollars for pre-orders and fixed at Bitcoin’s value on release day, the brand was able to make immediate trades to eliminate currency risks.

It’s not just the luxury watch market that is embracing cryptocurrency these days, and secondary markets have sprung up within the worlds of art and real estate, too. With the likes of Bitcoin, Ethereum and other cryptocurrencies having bestowed such wealth upon a select elite, there’s no denying that there is demand for an increase in ways to spend it, and everyone from luxury concierge services to yacht builders are jumping on board.

Elizabeth White – founder of the White Company – made an early experimental investment in Bitcoin early on, and it was this fateful move that allowed her to create the empire she holds today. The White Company now acts as a broker for crypto-holders to purchase helicopters, yachts, luxury cars and works of art, with over 30,000 clients globally taking advantage of the offering. Many have spent upwards of £1 million in a single transaction; a sure sign, if you needed one, that there are many out there with crypto-currency to burn. The White Company even offers a crypto-credit card alongside a major bank issuer – not that its customers are in need of any credit.

As more and more companies begin to follow suit, we can be certain to see crypto going more mainstream over the coming years – although this may well remain reserved for the luxury market and its customers. Your average consumer simply doesn’t have crypto-currency to spend, and the exclusivity buying in Bitcoin offers the elite is an added selling point for those targeting the world’s biggest spenders.

 

 

via luxurylifestylemag

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