Taking Farmers On-Chain — The Tokenization of Farmland

Taking Web2 concepts onto the blockchain is just another step in the right direction for mass adoption of Web3.

The tokenization of farmland is a new concept that has been greeted with open arms.

Yes you heard correct, physical land owned by farmers is on the blockchain. Similar to that real estate fad in the blockchain, but maybe with more intent.

Let’s look into it in more detail.

Tokenizing Farmland Explained

By taking the value of physical farmland, blockchain companies are now able to apply this to on-chain tokens and other digital assets like NFTs. Farmland becomes registered on the blockchain and is tokenized.

Tokenizing land in this way can offer new ways to invest for investors. You can fractionally buy parts of the land conveniently and it also alleviates stress of land maintenance that’s associated with traditional farmland.

Why It’s Necessary For Farmers

Farming in western countries is in a bit of a gray area at the moment. Weather is unpredictable in some locations which can negatively impact the farming process.

Here are the benefits the tokenization of farmland is bringing:

• All On-Chain

Putting the data on-chain for the land is creating a more transparent and democratic playing field when investing in land. Now it’s clear who owns what and when it was owned all thanks to the open-sourced nature of the blockchain.

• Onboards New Users

Getting new users onto the blockchain is part and parcel of the emerging industry. To get these people onboard, familiarity and value have to be created, otherwise where’s the appeal. The farming and agriculture industry in Europe is valued at €537.5 billion and grows every year.

• Accessibility For All

Investors can now buy fractional shares of farmland through tokenization. This creates a more democratic playing field in the world of farming and agriculture and brings more overall value to the industry in the long term.

• Farmers Are Incentivized

Traditional farmers can now tokenize their own farmland to boost their agricultural efforts. They can withdraw capital and invest in more sustainable farming practices. Furthermore it’s

Who Is Leading the Movement?

Here are some of the leading projects bringing farmland tokenization to the masses. Be sure to check them out for yourself.

Agridex: This is a Solana based RWA marketplace that’s reshaping the agriculture industry. It’s aim is to protect supply chain management from farmers all the way to the stores that shelf their products.

Finka Token: “From grass to cash” — a fitting motto for Finka token that essentially gives a share of a physical farm to those who hold their utility token. Specifically this token covers cattle ranching, now making it accessible for retail investors.

Agrotoken: The first global infrastructure for agricultural commodities tokenization. Grains are turned into Agrotoken which can be then used for goods, services and other assets for businesses around the world.

Regulatory Concerns and Considerations

Investments always have regulatory concerns.

This new paradigm of crypto and blockchain is still new, meaning there will be hurdles to overcome. After all, investors and now even farmers must be protected when assets become tokenized.

It will all depend on the jurisdiction both parties lie in. Some nations have stricter rules than others, for example the U.S is more tight on legislation surrounding digital assets compared to a place like The Middle East.

Time will tell how the law will intervene in this new asset class.

It will also depend on the partnerships fostered with agricultural management firms. Will they get onboard with the tokenization of farmland or will they dismiss it?

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