There are very specific rules connected with the Kiddush cup. We are to treat it with great care as a Mitzva is being done with it.
Because of possible imperfections or residue, it is preferred to rinse the Kiddush cup on the inside and outside. Some have the custom to add a little bit of water to the wine.
This is done either because in Talmudic times, wine needed to be diluted. Or, on a Kabbalistic level, wine is connected with דין, judgement, and adding water, sweetens the דין in our favor.
Because there were rabbis in the Talmud who wrapped themselves and covered their heads when holding the Kiddush cup, the Mishna Brura says that it is a nice custom to put on a coat and hat before Birkat Hamazon.
We also need to treat our Kiddush cup respectfully and try to use one with no blemishes.