Should Luxury Reassess Its Relationship with Cryptocurrency?
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Loading... - David Smith
- 07 Jun 2022
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The global crypto meltdown, which took place last week, saw Bitocin and other cryptocurrencies dropping to levels as low as before the crypto surge back in 2020. Ethereum, one of the most popular currencies used when trading NFTs, fell roughly 22 percent, while Bitcoin dropped to around $27,000 — a 12 percent fall from its current value. Since the crash, however, prices have started to recover slightly, with Bitcoin and Ethereum climbing back by around 7 percent, as reported over the weekend.
Given the current volatility of the crypto landscape, is it a wise time for luxury brands to be launching and establishing new forms of cryptocurrency? Only one week before the market crunch, Gucci announced the testing of a cryptocurrency initiative, one where consumers could use their digital wallets to purchase tangible goods in the brand’s physical stores. This was just another addition to the roster of luxury labels testing the waters with native currencies and crypto crossovers. Meanwhile, the question stands as to whether consumers can regain their trust in this notoriously volatile market, and whether implementing strategies like these right now are less innovative and more ill-considered.
What Happened: On April 1, Tiffany & Co. staged a timely prank on its consumers as an April Fools joke, claiming that the label was venturing into crypto-trading. “TiffCoin,” the brand’s supposed title for its faux cryptocurrency, went viral on social media after the retailer posted a promotional video announcing its release. After the truth behind the hoax was unveiled, however, Tiffany disclosed that the TiffCoin was indeed real, but in the format of a minted 18k gold coin as part of a 499 limited edition collectible series priced at $9,999 apiece. The coin went on sale at 11:11am the next day, with each collectible giving its holder access to future Tiffany happenings. Read More...
