Crypto News

Tokenized agriculture could provide economic relief to Argentine farmers

Blockchain proponents claim that agricultural asset-backed tokens would make it easier for farmers in Argentina to attract investment and access liquidity amid a nationwide economic crisis.

Argentina’s brittle economy — stricken by endemic problems that have only worsened amid the COVID-19 pandemic — has sparked rising unrest in the country’s agricultural sector. Earlier this month, representatives of the bulk of national producers rejected President Alberto Fernandez’s government’s decision to suspend all exports of corn as part of its efforts to stem inflation and exert downward pressure on domestic corn prices. 

The farmers’ strike followed a similar wave of resistance in the oilseed and soy industries last December. The rise in labor unrest poses a challenge for the stewards of the national economy, given that agriculture contributes 60% of national exports and roughly 10% of Argentina’s GDP. 

With the peso in freefall, some overseas entrepreneurs are seeing an opportunity for the uptake of a technology-driven solution that could provide an alternative to help farmers weather Argentina’s prolonged economic distress. In particular, CoreLedger and tech firm Abakus intend to launch a peer-to-peer marketplace that would establish a digital, blockchain-based “barter economy” between agricultural producers in Argentina.

Tokenizing agricultural assets, the partners claim, would help farmers to hedge against inflation and access liquidity both nationally and internationally. Such a marketplace would enable the exchange of tokenized titles by farmers for any other tokenized asset on the platform — essentially establishing a form of parallel, asset-backed currency for local producers.

Abakus CEO Martin Furst contends that this set-up would bring “greater agency to farmers,” whereas the CEO of CoreLedger, Johannes Schweifer, claims that the approach could offer critical relief. Unlike cash and stock-based saving plans, their argument is that agricultural-backed tokens functionally become stablecoins, backed by physical assets, and are therefore well-suited to a domestic context stricken by currency devaluation. Schweifer argues:

“In an inflation-stricken country, access to physically-backed assets can be the difference between surviving and thriving for these farmers.”

In the aftermath of a 3.8% rise in consumer prices last October, persistent peso volatility and tensions in government amid the country’s ongoing, fraught negotiations with the International Monetary Fund, local producers may indeed be more receptive to trying alternative fintech strategies that can help them to escape the ruinous economic dynamics in the country.  

Alongside blockchain entrepreneurs, cryptocurrency exchanges also appear to be alert to a market opportunity in the region’s struggling economies, with Brazil’s largest Bitcoin (BTC) exchange —Mercado Bitcoin — recently announcing plans to expand across Latin America, including Argentina. Data from Useful Tulips suggests that Argentina currently ranks seventh in the region in terms of peer-to-peer Bitcoin trade volume.

How useful was this post?

Click on a star to rate it!

As you found this post useful...

Follow us on social media!

Disclaimer: The opinions expressed within this article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of CoinChapter and CoinChapter does not assume any responsibility or liability for the same.

(This story has not been edited by CoinChapter staff and is auto-generated from a syndicated feed.)
0 Comments
Inline Feedbacks
View all comments
CoinChapter

Founded in 2015, Coinchapter.com has become one of the leading resources for the crypto asset community. Created by a small group of cryptocurrency enthusiasts, Coinchapter.com was built to provide new members of the crypto asset community with unbiased listings of cryptocurrency exchanges and retail options that would allow them to buy the crypto assets that they wanted, how they wanted and at the price they wanted.

Related Crypto News

Cardano To Update Mary Protocol On March 1
Cardano’s core development team announced that the Mary protocol update will go live on March 1. Input Output also...
FD7 Ventures Converting $750 Million Of Bitcoin Into Cardano, Polkadot Tokens
Dubai-based crypto-investment fund FD7 Ventures is selling $750 million worth of Bitcoin. It will then use the proceeds to...
Grayscale Exploring 23 Cryptocurrencies For Potential Investment Products
Grayscale Investments has revealed the cryptocurrencies that it is considering to create new investment products. The world’s largest digital...
Kobe Bryant NFT Digital Art Is Being Valued At $20,000
Cryptocurrency trader known as “westcoastnft” has been involved in the industry since 2014. Mostly buying and selling Bitcoin over...
Stone Ridge Asset Management Adds Bitcoin To Diversified Alternatives Fund
Stone Ridge Asset Management will make Bitcoin part of its seven strategies for the Stone Ridge Diversified Alternatives Fund....
Kraken Planning To Raise New Funds At Over $10 Billion Valuation
Kraken is in talks with Fidelity, Tribe Capital and General Atlantic. To raise new funds with a target valuation...

Featured Crypto News

Cardano To Update Mary Protocol On March 1
Cardano’s core development team announced that the Mary protocol update will go live on March 1. Input Output also...
FD7 Ventures Converting $750 Million Of Bitcoin Into Cardano, Polkadot Tokens
Dubai-based crypto-investment fund FD7 Ventures is selling $750 million worth of Bitcoin. It will then use the proceeds to...
Grayscale Exploring 23 Cryptocurrencies For Potential Investment Products
Grayscale Investments has revealed the cryptocurrencies that it is considering to create new investment products. The world’s largest digital...
Kobe Bryant NFT Digital Art Is Being Valued At $20,000
Cryptocurrency trader known as “westcoastnft” has been involved in the industry since 2014. Mostly buying and selling Bitcoin over...
Stone Ridge Asset Management Adds Bitcoin To Diversified Alternatives Fund
Stone Ridge Asset Management will make Bitcoin part of its seven strategies for the Stone Ridge Diversified Alternatives Fund....
Kraken Planning To Raise New Funds At Over $10 Billion Valuation
Kraken is in talks with Fidelity, Tribe Capital and General Atlantic. To raise new funds with a target valuation...