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Blockchain for Ag: Startups & Investments
Despite its potential future implications, blockchain companies offering tangible results of significant scale are limited. That narrative carries over into agriculture, where blockchain startups are slowly starting to grow in number, though notable funding rounds remains to be seen. Supply chain companies have seen a lot of action in 2017, with 28 deals valued at $166 million in H1 2017, a 21% YoY increase.
Only one blockchain company – Northern Ireland- based arc-net – was on the list of the top 15 deals, coming in at No. 15 with a $2.5 million raise.
Still, there is room for optimism. AgriDigital, one of the earliest players to adopt blockchain for agriculture, recorded the first live settlement of a physical commodity good on blockchain and now processes 5% of Australia’s grain production (1.5 million metric tonnes).
Another startup – Denver-based bext360 – provides an innovative solution to the coffee bean supply chain indicative of the overarching goal for most blockchain-centered ag companies. Using machine learning and artificial intelligence, bext360 scans all of the coffee cherries at the farm site to evaluate a payment amount. Those payments are delivered through a blockchain-backed transaction. Bext360 then tracks the cherries throughout the entire supply chain to give the consumer a complete history of the product, including whether or not it was ethically sourced and if the farmer received fair compensation, often a problem in this particular industry. With their technology, bext360 optimizes blockchain to do what it does best – provide transparency and certainty throughout the supply chain. In doing so, blockchain adds value by providing a guarantee of the product’s origins, justifying a premium, or discount, price for the consumer.
Consumers demand superior products, particularly when it comes to food. Blockchain gives every actor along the supply chain, from farm to fork, the ability to demonstrate their product’s superior quality. By correcting for the lack of transparency and trust, blockchain enables unrivalled efficiency and creates a system of shared data that maximizes profits by cutting costs and improving the relationships between customer and provider.
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