Summary
- Farmers in Paraná, Brazil, have tokenized 10 dairy cows on the B3 stock exchange, raising nearly $20,000 in credit backed by their livestock amid tighter bank lending.
- The project, led by agtech firm Cowmed, uses AI-powered tracking collars to create encrypted digital identities for each cow, preventing double-pledging and enabling cows to serve as movable collateral.
- Cowmed, which already monitors about 100,000 cows worth more than $395 million, expects up to 20% of its network to adopt this tokenized financing model, potentially unlocking $77.6 million in new agricultural credit as part of a broader push into real-world asset tokenization.
Farmers in Parana, Brazil, struggling to get banks to loan them cash, became the first to tokenize livestock and place 10 dairy milk cows‘ tokens for trade on the country’s B3 national stock exchange. They generated nearly $20,000 in credit backed by their cattle, signaling the potential of tokenizing RWAs as a financing tool.
The dairy cow tokenization in Brazil is a world first and serves as a test in a real-world scenario in which farmers are facing increasingly stringent lending limits imposed by local banks on small agricultural businesses.
We take the cow, which is a real and tangible asset, and transform it into a digital asset backed by a unique code monitored in real time, Thiago Martins of Cowmed, a Brazilian Agtec company, told CNNBrasil recently.
Martins and his company did not immediately respond to a CoinDesk request for comment.
“This digitization allows for formal registration with B3 as a movable asset,” Martins added. The process is simple and gives the producer an advantageous opportunity to finance themselves, opening a new alternative for collateral at a time of strong credit restrictions in agribusiness.