The beginning of a new calendar year is an ideal moment for both reflection and speculation. Following countless developments over the last 12 months – both good and bad – there are probably no better markets to analyze than the luxury watch industry and NFT space. Since these industries are beginning to overlap more and more, it’s a great time to explore this symbiotic relationship.
Jacob & Co. Forges the Path
The alliance between luxury watches and NFTs is a relatively recent one. While wristwatches in the traditional sense have been around since the 16th century, NFTs only really started cropping up in 2021. So, what is the common denominator between these two vastly different industries? To put it simply, both generate potentially lucrative assets that have gained immense traction as alternative investments during a tumultuous time on the stock market.
The first actor to merge the two was a watchmaker and jeweler Jacob & Co. from New York City. The fusion came as a digital version of their SF24 Tourbillon timepiece. The original (i.e., physical) version boasts Jacob & Co.’s patented world time display, a split-flap system inspired by old-school airport departure boards, that shows the time in 24 cities. When it came to creating the world’s first luxury watch NFT, the brand decided to anchor the connection to the digital world by shelving the time zones and displaying cryptocurrencies like Bitcoin and Ethereum instead. The ten-second animation fetched $100,000 at auction from an unknown bidder, while the “real” version retails for $210,000.
After their pioneering venture into the world of NFTs was deemed a success, Jacob & Co. pushed ahead and announced an entire line of products to further blur the lines between physical and digital luxury goods. Their Metaverso Collection consists of eight elaborate watch designs, five of which come with a tangible timepiece, while the other three exist only in the digital sphere. Details on the auction to take place on the UNXD platform are still to be announced, so it’s too early to say whether their success will continue.
Other Brands Get on Board
The arrival of NFTs in the collecting world has not gone unnoticed by other household names in the world of haute horologie, and even some of the more traditional manufacturers have set their sights on the added value of these digital assets. However, NFTs in the luxury watch space do not just take one form. Breitling, a well-respected manufacturer with a history stretching back as far as 1884, has harnessed the power of the metaverse in an entirely different way. Since October 2020, all Breitling watches have come with their own NFT (or digital passport, as the company calls them) as proof of ownership and authenticity. It has been speculated that such technology will soon replace the original papers that accompany a luxury watch when bought from an official retailer. These documents are often vital on the secondary market, playing a huge role in resale value and in ensuring potential buyers that the seller is the timepiece’s rightful owner.
More recently, in November 2022, news emerged that Rolex had filed a patent application for services and products connected to NFTs and cryptocurrencies. With no official announcement from the brand itself, there has been swirling speculation about whether this move was simply strategic, or if the brand with the crown will leverage the advantages of such digital assets and services in the future. This comes on the heels of the momentous announcement that Rolex will start selling certified pre-owned watches for the first time in the brand’s history.
Developments to Come
The first quarter of every calendar year is usually rife with new releases from established brands. Watches & Wonders 2023, for example, the international trade show for the Swiss watch industry, is slated to take place between March 27 and April 2. With a grand total of 49 brands set to exhibit, watch enthusiasts and collectors have begun to speculate about announcements. Whether we will see further developments solidifying the role of NFTs in the luxury watch market is anybody’s guess, but the benefits of NFTs are clear. They provide a way to authenticate and certify luxury items, which is crucial in a market where counterfeits are not uncommon. They also provide a way to track the provenance of a specific timepiece, which is advantageous for collectors.