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BA Deere
Honored Advisor

Token Economy, Blockchain Agriculture

I think it was Jim Meade that brought this up and perhaps Successful Farming did a article about it a few years ago.  But it was too new and went over my head, I still don`t understand it.  Yesterday Ric Edelman was talking about, graphic art selling for $10s of millions, sports trading cards $ thousands and a common person may sell pieces of his $500,000 home to investors to generate cash.  A little like the old school "reverse mortgage" without some of the headaches.

I immediately wondered if farmers will take advantage of this (if it is an advantage) and i came across this recent article from Forbes.  I guess this explains the Bitcoin going absolutely nuts as of late.

https://www.forbes.com/sites/michaeloloughlin/2021/01/27/argentinian-farmers-to-benefit-from-a-block...  

snip:

Can tokenization really alleviate inflation for developing countries around the world? This is a common question amongst modern-day economists and emerging technology enthusiasts alike. It turns out that tokenized agriculture via blockchain technology is indeed providing significant opportunities for crucial economic relief.

A prime example of this brings us to Argentina, where farmers are grappling with a plummeting peso amidst pandemic uncertainties, with net currency reserves near zero and inflation risking to 40%. Tokenized agricultural assets could offer farmers the ability to seek a hedge against inflation and access liquidity via certified financial titles accessible by both national and international investors. With more than 40% of the world’s soybean oil and soy-meal production coming from Argentina, it is of great national interest that smallholder farmers can liquify their real, physical assets.

Agricultural-backed tokens are becoming a critical solution to solving volatility and liquidity issues inherent in most cash and stock-based saving plans. As such, tokenized agriculture has the potential to help developing countries generate more investment and export opportunities across a range of agricultural industries.

Speaking with Coreledger, a platform that allows businesses to access the benefits of blockchain technology, they shared news of their new partnership with Abakus, a soon to be launched P2P marketplace. Together they aim to launch a digital barter economy in Argentina, enabling farmers to tokenize their agricultural assets and seek relief from looming hyperinflation.  Such a marketplace would enable farmers to redeem and trade their tokenized titles with any other tokenized asset on the Abakus platform. This means that soybeans could effectively work like an asset-backed currency, and be traded for cattle, corn, or even the peso.  

“In an inflation-stricken country, access to physically-backed assets can be the difference between surviving and thriving for these farmers”, said Johannes Schweifer, CEO of CoreLedger. Meanwhile, Martin Furst, CEO of Abakus commented, “the tokenization of agricultural assets brings greater agency to farmers who can now sell the physical-backed assets according to their own needs.”

So there you have it, a soy story of sorts, a new use case of how tokenization can help developing communities. It remains to be seen whether agricultural-backed tokens truly solve volatility and liquidity issues inherent in cash and stock-based saving plans. The argument in favor is that these tokens become actual stablecoins, backed by real assets, not unstable fiat currencies. Tokenized agriculture will no doubt provide an opportunity for developing countries to generate more investment and export opportunities across a range of agricultural industries, improving financial inclusion on the ground, and giving locals a medium of exchange that’s not at risk of devaluation.

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15 Replies
Packard27
Senior Contributor

Re: Token Economy, Blockchain Agriculture

Blockchain technology, crypto curriencies and their legal tender applications utterly mystify me. They seem too volatile in their present form. They also seem subject to angering IRS agents and their equivalents around the world should the crypto become too powerful.

So here’s a hypothetical case. Suppose you own 100 acres of productive Iowa farmland valued at $1 million. Then suppose a man shows up and offers to pay you double the worth of the land (i.e. $2 million) in blockchained Bitcoin. You agree.

The transaction is completed. The man now owns the deed to your former 100 acres of land. You, for your part, get to own a super secret algorithm (a.k.a. Set of unique and verifiable numbers). 

One year, five years, or even 100 years from now, most of us might take some educated guesses as to what will be happening with the originally transacted farmland. The blockchained Bitcoin, however, is another matter entirely. 

The question then is, even if offered a premium, are you better off owning the hard asset of farmland, soybeans, John Deere stock or the crypto currency algorithm? Ownership of hard property in a free country should be as good as the government that protects the property rights of the individual. Possessing Bitcoin for any length of time appears (at least to me) to be fraught with more risk than I could ever sleep with...if that makes sense?

 

sw363535
Honored Advisor

Re: Token Economy, Blockchain Agriculture

It is a matter of "Can he convince you this idea he claims to possess has value"  or even actually exists from day to day.

There should be a green universe ordinance against such things

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rsbs
Veteran Advisor

Re: Token Economy, Blockchain Agriculture

the American dollar is backed by the full faith and trust in the American Nuclear arsenal.

What backs up the Bitcoin?

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sw363535
Honored Advisor

Re: Token Economy, Blockchain Agriculture

A concentration of wealth in tech nerds with limited educations??????

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Packard27
Senior Contributor

Re: Token Economy, Blockchain Agriculture

What could possibly go wrong?

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k-289
Senior Advisor

Re: Token Economy, Blockchain Agriculture

Did  Bernie  Madoff ,  have  the  wrong  label  on  his  product  - maybe - ? 

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Packard27
Senior Contributor

Re: Token Economy, Blockchain Agriculture

Note only that Bernie ran his Ponzi scheme for more than 17 years.

Oftentimes it takes a severe fiscal crisis to reveal who the bad actors are on Wall Street. Ironically, embezzlement actually goes down in hard times. This is because when money becomes dear, people begin to watch the books much more closely. When the additional scrutiny occurs, scam artists like Madoff are either outed or become increasingly circumspect about engaging in any new criminal activities.

Then there is Tesla, GameStop, ESG investing, and Bitcoin... but this time its different, ehhh?

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BA Deere
Honored Advisor

Re: Token Economy, Blockchain Agriculture

Events are strange, I recall the "80s farm crisis" I thought "farmers will be gun shy going in debt again" I couldn`t have tea the tea leaves more wrongly.  The stock market crashes, some nervous Nellies do cash out, but ultimately more suckers always come in and push it to even higher levels.  

Admitting that you are a socialist is far from the political kiss of death these days over 43% of Americans agree with you.  There are other examples of why "this time is different" not that I like people not getting their hand burnt touching a hot stove, it`s just I have 3rd degree burns all over my body just waiting for those touching the stove to get burnt   Smiley Happy

https://medium.com/illumination/in-2030-youll-own-nothing-and-be-happy-about-it-abb2835bd3d1  

snip:

1. “You’ll own nothing” — And “you’ll be happy about it.”

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k-289
Senior Advisor

Re: Token Economy, Blockchain Agriculture

CONsolidation  is  a  brutal ,  clever ,  financial  gimmick' ty , with  daily  happenings  present  in  your  photo - - -

BA - the photo  is priceless ,  and  just  imagine  the  tribulation  of  attempting  to  verify  the  contents  of  up  to 

20,000  T  E  U   on  this  U L V C  -  -  -

EVER  GIVEN ,  might  be  the  keys  to  reality  101 ,  and  the  96  ROW  planter  -  maybe ?

         

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