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Scottish Distillery Uses Blockchain Technology to Fight Counterfeit Whisky

Scotland's whisky industry began as contraband. Distillers once outran English tax collectors. The business has since grown into a global powerhouse worth billions. Scottish food and drink exports re

By Aubrey Swanson··2 min read
Scottish Distillery Uses Blockchain Technology to Fight Counterfeit Whisky

Key Points

  • Scotland's whisky industry began as contraband.
  • Distillers once outran English tax collectors.
  • The business has since grown into a global powerhouse worth billions.

Scotland's whisky industry began as contraband. Distillers once outran English tax collectors. The business has since grown into a global powerhouse worth billions.

Scottish food and drink exports reached £5.5 billion in 2016, a gain of £421 million from the prior year. Scotch whisky shipments climbed to over £4 billion, up 4 percent, adding £153 million. The sector now counts 98 active malt distilleries across Scotland, each producing spirits with distinct profiles that appeal to drinkers worldwide.

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Counterfeiters pose an escalating threat. Consumers buying rare Scotch risk receiving fakes. Adelphi, which owns and operates Ardnamurchan Distillery in the Scottish Highlands, saw an opportunity. The company partnered with arc-net, a blockchain technology company, to place a limited edition whisky on the platform—a first for the whisky industry.

The system allows customers to trace each bottle's path from distillery through distribution to their hands using a QR code. By tracking bottles this way, Adelphi could prove authenticity and undercut counterfeiters.

Alex Bruce, managing director of Adelphi, said the blockchain platform lets them capture and share production details with their customers. "In addition to a growing number of countries, globally, recognising Scotch Whisky's Geographical Indication (GI), we also believe it to be essential that the consumer is able to understand the craftsmanship of making it, and for the producer to ensure the security of their route to market," Bruce said. For Adelphi, the system replaced old paper records with transparent digital information that streamlined their operations.

Sean Crossey, an associate digital marketing analyst at arc-net, told MiningPool the partnership moves the company toward its mission of delivering safe and authentic products to consumers worldwide. "This project brings huge innovations to the spirit and whisky industry. It brings massive implications for provenance, authenticity, accountability, traceability, security, stock control, and more. By connecting their product from the barley field to the bottle, Adelphi and the Ardnamurchan Distillery now can greatly improve their company story-telling, marking a breakthrough in their marketing activity," he said.

arc-net has also collaborated with PwC's operations in the Netherlands to develop blockchain tools for combating food fraud on a global scale.

MiningPool content is intended for information and educational purposes only and does not constitute financial, investment, or legal advice.

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