Five ninths formed ruminations concerning the merge requests of web3 & agriculture
A couple of web3 projects that are trying to address challenges faced by small farmers
Some web3 projects related to agriculture that have peaked my curiosity of late + some homework for me:
EthicHub
Basically using DeFi to provide collateral and hence securing loans for small farmers who are usually unbacked and pay extremely high annual interest
Seems to be mostly based in Spain but serve small farming communities mainly in Central and South America
Has been around a long time in the web3 space: 2018
Claims to have facilitated “$5 million to more than 10,000 farmers”
One very interesting aspect which reminds me of the very low default rates of most microfinance institutions is the claim of “After 3 years with real experience in the field and a default rate of less than 2%”
More info can be found here: https://docs.ethichub.com/en
Brú Finance
They seem to do a lot of things nowadays with the title of “building a DeFi lending platform to create bank-less finance option for owners of real-world assets across the globe.” (source)
They seemed to have started by working with public/private warehouses in Maharashtra, India enabling (sometimes unbanked) small farmer to store their crops there. Then providing a loan for the farmer with their crop as collateral that could be minted into an NFT and financed by either DeFi or traditional finance players. (source)
This then abled the farmer to have liquidity but also sell their crop at a later time when the prices were not crashing because most other farmers have to sell right after harvest.
More info can be found here: https://bru.finance/farmerbonds
TODO:
Dive more into these: