A fund launched in March with the aim of tokenizing up to $20 million worth of whiskey has announced its first successful investment round and the purchase of its first tranche of Kentucky bourbon.
Wave Financial Group announced Sept. 11 that its Kentucky Whiskey 2020 Digital Fund had bought an initial 1,000 barrels from the Wilderness Trails distillery.
Investors are expected to benefit from the spirit’s price appreciation during the aging process of around five to six years. As Cointelegraph previously reported, the value is expected to increase from around $1,000 per barrel to around $4,000 per barrel during this period.
Certain real-world assets such a whiskey are exceptionally difficult for investors to get exposure to, explained fund manager Benjamin Tsai:
“Our extensive research has shown that the returns from ageing Kentucky bourbon are very stable and strong over the circa 5 year period it spends in barrels before being bottled, so we are delighted to be able to provide investors with exposure to this price appreciation.”
While Wave expects most investors to hold the asset for the full term until it is bottled, the holding will be tokenized in year two. This will allow any investor who wishes to exit the scheme early to do so, provided they can find a buyer.
The fund’s access to the Wilderness Trails distillery’s production capacity for the year is still open, and Wave is continuing to raise capital for further investment rounds.