Entering 2016, provenance – or the ability to ensure ownership and chain of custody – was named as a potential breakout use case for blockchain technology, and while this prediction has yet to come to pass, new startups are entering the market.
The latest to emerge on the scene is Chronicled , which has raised $3.4m to explore whether blockchain tech can be a value-add for the purchasers of collectible sneakers.
As described by The New York Times , the scene is one where "mostly male, mostly teenage" buyers quickly amass thousand-dollar collections. According to informal estimates, the secondary market for collectible shoes is valued at $1.2bn in the US alone.
But Chronicled is banking on the fact that this state of affairs will provide the best luxury goods market for its blockchain applications. Competitors have so far chosen to apply similar concepts in digital media and precious stones.
Chronicled CEO Ryan Orr told CoinDesk: "The challenge with an authenticity platform lies in getting to scale. Clearly customers could scan collectible items, men’s fashion, women’s fashion, and know they would be getting a legit item. But how do you build a niche? We reviewed about 30 different market verticals when we launched the company." Orr said that, unlike other luxury goods marketplaces, collectible sneakers were appealing because it isn’t dominated by "old white males" or constitutes a process that takes years to complete.
"It’s a very fast flip, where you also have a mobile first market. It’s not a market like fine art where you have a five-year lag between the resale and you have to wait five years every time [a product] sells," he continued.
Orr also noted that the luxury sneaker market has a vibrant sub-industry of buyers and sellers, with collectors often seeking to resell their purchases quickly after an initial sale. […]
