4 ms·

Brazilian farmers tokenized dairy cows to get loans, bypassing bank limits

61 points by paulpauper 3mo ago

guess_who_is_it 3mo ago
coindesk only promotes ztrash
tiffanyh 3mo ago
Using livestock as collateral is one of the oldest ways to obtain a loan.
- marcosdumay 3mo ago
  It's also one of the most famous recurrent scams in Brazil.
- mmooss 3mo ago
  But how do investors collect on this collateral? Do they have any legal leverage? And how does blockchain help them? Blockchain and tokenization would seem to help with transactions with investors who are far away who don't know the farmers personally. Again, how do they collect? And if you're local and know the farmer, why do you need blockchain? A spreadsheet, a piece of paper, or just a handshake would do.
- m3047 3mo ago
  https://en.wikipedia.org/wiki/Banditti_of_the_Plains https://en.wikipedia.org/wiki/Banditti_of_the_Plains
tamimio 3mo ago
This is how economy should work, based on physical tangible assets that owned/existed, not some imaginary value based on whatever speculation, that what ruined housing market, what inflated stocks and allowed cons to get wealthier, it’s also why a lot of companies make fake job posting or pr stunts, it’s all to inflate that imaginary market currency then use it to get a real cash, that should be illegal and is a form of Ponzi scheme fraud, if a house as-built cost is 70k, it shouldn’t be sold for 800k, and the owner shouldn’t be able to use that speculative value to get a 600k loan.
- WalterBright 3mo ago
  It sounds like you're suggesting a barter economy. It works like this: 1. Bob grows oranges, and wants shoes 2. Ted hunts for meat, and wants oranges 3. Sam makes shoes, and wants meat The only way this can work is to have a 3-way transaction. But with a money system, the money is traded without needing a 3-way transaction. It's much more efficient.
  - tamimio 3mo ago
    Not really, I am not saying to remove moneys entirely and use assets trading only, but the money printed or valued should be based on tangible assets, actual cost, not some made up speculation. As I mentioned above, a house that cost 100k to build and handover should never exceed that value plus profit markup, the older it gets, the cheaper it should be, just like any other assets and like how japan did it to solve the greedy banks/landlords. But obviously such thing needs to be done in an authoritarian manner as in normal democracy it will never be voted for, since most voters are owners. Other examples apply too on why things are waay over inflated for what they worth, including stocks.
    - throw1234567891 3mo ago
      There are no moneys, only money. I don’t understand your reasoning. Why should a house never become more expensive? I built a house in s remote area, 20 years later the region is much more appealing, public transport, shopping, why should I charge less than the market is willing to pay?
      - tamimio 3mo ago
        Because a house is a shelter, not an investment, go start a business if you want that. Japan did the right thing and made it a depreciated asset to end this ponzi scheme >than the market willing to pay That’s the crux, a market speculation. Well, the market is also willing to pay more for death match gambling, that doesn’t mean it should be there.
bernardom 3mo ago
Brilliant idea, but why the crypto? Couldn't you simply do the collar + web connection... without crypto?
- asxndu 3mo ago
  With what platform? Stripe, Visa and Banks that arbitrarily ban users?
  - nickphx 3mo ago
    huh? platform? lol. you go to bank with proof of collateral.. get secured loan. wtf does everything need a platform or some VC garbage scrambling to find rent.
    - pstuart 3mo ago
      because blockchain blockchains! I must confess I'm enamored with the concept of blockchains, but find their value questionable for the most part. I even worked for a blockchain startup (non-crypto) but left on less than good terms and a fair amount of PTSD. They were nuts!
    - Brian_K_White 3mo ago
      even the title says the bank does not give you the loan
    - goodmythical 3mo ago
      Not familiar with the situation in Brazil, but it could be as simple as local credit being harder to get than global credit, or a desire to deal in a denomination that local credit doesn't typically offer without hitting a conversion fee. A local farmer could perhaps figure out how to contact a swiss banker all on their own, but it would be a lot easier, and cheaper, if there were single place (or better yet, a few competing places) that offer a central place that anyone looking to use/supply credit could come together.
- arjie 3mo ago
  I would imagine local credit is more expensive to access and doesn't have the pre-existing structure to account for more reliable collateral. Another user here[0] says that using cows as collateral is an old scam there. So either this is an expansion of the scam in the worst case (possible) or it's to compensate for the fact that local lenders are trained by interaction to not lend to what looks like the latest scheme (i.e. this well has been long ago poisoned). e.g. if you go to suburban Japan and you walk by someone on the street who asks you for help and needs to call someone, you may lend them your phone. If the same thing were to happen in SF, you shouldn't. And so, perhaps, if you were a good guy you go ask a Japanese tourist haha! Okay, well the analogy is a little stretched but hopefully you get something out of it. 0: https://news.ycombinator.com/item?id=49049723 https://news.ycombinator.com/item?id=49049723
vvpan 3mo ago
Real World Assets (RWA) is the hot stuff these days. While it is still early the mega-banks are starting to pile on. One of the reasons is that any infrastructure built on blockchain is reusable for free by everybody (minus transaction free). Uniswap and Aave have been chugging along for years and are starting to acquire reputation beyond retail. Privacy is moving along as well where you can tokenize, say, bonds and hide the in/out flows with ZK proofs. You can track RWA issuance here https://app.rwa.xyz/ https://app.rwa.xyz/
- JumpinJack_Cash 3mo ago
  How can it be hot? Real means that it has a tangible value, a ceiling and so it cannot be charged up by the psychological hypetrain of the 'new paradigm' and also the financial hypetrain of number going up. It is a pretty confined upside if anything I looked into it years ago when I wanted to tokenize small firefighting planes and helicopters hoping that being the person in charge of the entity doing the tokenization I could be staying at the premises of the private companies that lease the planes and helicopters and hold the contracts to do the actual firefighting. My hope was that being identified as the 'owner of the planes' eventually the crew would allow me to fly the missions as a +1 even though I don't have the licenses. But never crossed my mind that this could be make me a millionaire
- mmooss 3mo ago
  > Real World Assets (RWA) is the hot stuff these days. > Uniswap and Aave have been chugging along for years How hot? I haven't heard of it or them, but that's hardly strong evidence. What do you see? > One of the reasons is that any infrastructure built on blockchain is reusable for free by everybody Does that have an impact? I doubt consumers care about free. They certainly care about high levels of integrity (my money is safe) and availability (I can access my money), as well as profit (interest / gain). I've never heard a consumer say, 'I use Bank Z because their financial operations run on FOSS.' Mega-banks would seem to dislike FOSS. They want barriers to entry; they will find it inefficient, frustrating, and very limiting - with a significant and direct impact on their bottom lines - to deal with a bunch of amateurs. That's why you're not allowed on the trading floors, electronic or physical, and Goldman Sachs directors won't take your calls (until you establish yourself). I suspect free matters to undercapitalized startups, amateur financial services, and hackers interested in innovation in this area. But again, there's a lot I don't know ...
chrisjj 3mo ago
> We take the cow, which is a real and tangible asset, and transform it into a digital asset Fine... if you don't need the cow too.
Animats 3mo ago
"It also includes built-in safeguards that allow the farmer to swap one dead cow for a live one." Is that backwards? If you own the token for a cow, and it dies, what happens?
- jt2190 3mo ago
  There’s a credit agreement that will spell out those details: > To turn cattle into trusted financial guarantees or collateral without requiring inspectors to visit the property, Cowmed equips cows with an AI-powered Smarty Collar. These collars constantly monitor health, behavior, and location. The raw data is then converted into an encrypted digital identity tied directly to the B3 credit agreement. [Emphasis mine]
  - kmoser 3mo ago
    I wonder what opportunities exist for a malicious actor to intercept the data flow and substitute it with their own, either for the purposes of devaluing someone else's cow or to increase the value of their own--or even to generate fake cow biometrics, feed them directly to devices, and pretend you have a real, live herd.
    - Animats 3mo ago
      It's crypto. Someone will do that.
      - goodmythical 3mo ago
        >local college student sells 11 brazillian cattle to pay off student debt
  - reaperducer 3mo ago
    Cowmed equips cows with an AI-powered Smarty Collar. These collars constantly monitor health, behavior, and location. They've had these for cows in America for years, and even for people in the hospital. Long before "A.I." What makes these "smart," as compared to something like a bio button? https://www.medtronic.com/en-us/healthcare-professionals/products/patient-monitoring/remote-patient-monitoring/intelligent-patient-monitors/biobutton-multi-parameter-wearable.html https://www.medtronic.com/en-us/healthcare-professionals/pro...
jareklupinski 3mo ago
finally, economics explained by cows, so i can finally understand it
idiotsecant 3mo ago
Tokenizing physical things is kind of dumb for one reason: it's not trustless and it relies on there being a big mean cop somewhere in the transaction. Say i tokenize my couch and then sell you the the token. Suppose you show up to my house to claim your couch. I can tell you no. You can then sue me and try to get the state to send a big mean cop to get it, or it's equivalent in cash. I've yet to see a scheme that makes this trustless somehow. If you don't have that you don't have anything.
jnyst1985 3mo ago
Wait - is this finally crypto’s mass adoption event we’ve all been waiting for?

61 points by paulpauper 3mo ago

guess_who_is_it 3mo ago

coindesk only promotes ztrash

tiffanyh 3mo ago

Using livestock as collateral is one of the oldest ways to obtain a loan.

marcosdumay 3mo ago
It's also one of the most famous recurrent scams in Brazil.
mmooss 3mo ago
But how do investors collect on this collateral? Do they have any legal leverage? And how does blockchain help them? Blockchain and tokenization would seem to help with transactions with investors who are far away who don't know the farmers personally. Again, how do they collect? And if you're local and know the farmer, why do you need blockchain? A spreadsheet, a piece of paper, or just a handshake would do.
m3047 3mo ago
https://en.wikipedia.org/wiki/Banditti_of_the_Plains https://en.wikipedia.org/wiki/Banditti_of_the_Plains

tamimio 3mo ago

This is how economy should work, based on physical tangible assets that owned/existed, not some imaginary value based on whatever speculation, that what ruined housing market, what inflated stocks and allowed cons to get wealthier, it’s also why a lot of companies make fake job posting or pr stunts, it’s all to inflate that imaginary market currency then use it to get a real cash, that should be illegal and is a form of Ponzi scheme fraud, if a house as-built cost is 70k, it shouldn’t be sold for 800k, and the owner shouldn’t be able to use that speculative value to get a 600k loan.

WalterBright 3mo ago
It sounds like you're suggesting a barter economy. It works like this: 1. Bob grows oranges, and wants shoes 2. Ted hunts for meat, and wants oranges 3. Sam makes shoes, and wants meat The only way this can work is to have a 3-way transaction. But with a money system, the money is traded without needing a 3-way transaction. It's much more efficient.
- tamimio 3mo ago
  Not really, I am not saying to remove moneys entirely and use assets trading only, but the money printed or valued should be based on tangible assets, actual cost, not some made up speculation. As I mentioned above, a house that cost 100k to build and handover should never exceed that value plus profit markup, the older it gets, the cheaper it should be, just like any other assets and like how japan did it to solve the greedy banks/landlords. But obviously such thing needs to be done in an authoritarian manner as in normal democracy it will never be voted for, since most voters are owners. Other examples apply too on why things are waay over inflated for what they worth, including stocks.
  - throw1234567891 3mo ago
    There are no moneys, only money. I don’t understand your reasoning. Why should a house never become more expensive? I built a house in s remote area, 20 years later the region is much more appealing, public transport, shopping, why should I charge less than the market is willing to pay?
    - tamimio 3mo ago
      Because a house is a shelter, not an investment, go start a business if you want that. Japan did the right thing and made it a depreciated asset to end this ponzi scheme >than the market willing to pay That’s the crux, a market speculation. Well, the market is also willing to pay more for death match gambling, that doesn’t mean it should be there.

bernardom 3mo ago

Brilliant idea, but why the crypto? Couldn't you simply do the collar + web connection... without crypto?

asxndu 3mo ago
With what platform? Stripe, Visa and Banks that arbitrarily ban users?
- nickphx 3mo ago
  huh? platform? lol. you go to bank with proof of collateral.. get secured loan. wtf does everything need a platform or some VC garbage scrambling to find rent.
  - pstuart 3mo ago
    because blockchain blockchains! I must confess I'm enamored with the concept of blockchains, but find their value questionable for the most part. I even worked for a blockchain startup (non-crypto) but left on less than good terms and a fair amount of PTSD. They were nuts!
  - Brian_K_White 3mo ago
    even the title says the bank does not give you the loan
  - goodmythical 3mo ago
    Not familiar with the situation in Brazil, but it could be as simple as local credit being harder to get than global credit, or a desire to deal in a denomination that local credit doesn't typically offer without hitting a conversion fee. A local farmer could perhaps figure out how to contact a swiss banker all on their own, but it would be a lot easier, and cheaper, if there were single place (or better yet, a few competing places) that offer a central place that anyone looking to use/supply credit could come together.
arjie 3mo ago
I would imagine local credit is more expensive to access and doesn't have the pre-existing structure to account for more reliable collateral. Another user here[0] says that using cows as collateral is an old scam there. So either this is an expansion of the scam in the worst case (possible) or it's to compensate for the fact that local lenders are trained by interaction to not lend to what looks like the latest scheme (i.e. this well has been long ago poisoned). e.g. if you go to suburban Japan and you walk by someone on the street who asks you for help and needs to call someone, you may lend them your phone. If the same thing were to happen in SF, you shouldn't. And so, perhaps, if you were a good guy you go ask a Japanese tourist haha! Okay, well the analogy is a little stretched but hopefully you get something out of it. 0: https://news.ycombinator.com/item?id=49049723 https://news.ycombinator.com/item?id=49049723

vvpan 3mo ago

Real World Assets (RWA) is the hot stuff these days. While it is still early the mega-banks are starting to pile on. One of the reasons is that any infrastructure built on blockchain is reusable for free by everybody (minus transaction free). Uniswap and Aave have been chugging along for years and are starting to acquire reputation beyond retail. Privacy is moving along as well where you can tokenize, say, bonds and hide the in/out flows with ZK proofs. You can track RWA issuance here https://app.rwa.xyz/ https://app.rwa.xyz/

JumpinJack_Cash 3mo ago
How can it be hot? Real means that it has a tangible value, a ceiling and so it cannot be charged up by the psychological hypetrain of the 'new paradigm' and also the financial hypetrain of number going up. It is a pretty confined upside if anything I looked into it years ago when I wanted to tokenize small firefighting planes and helicopters hoping that being the person in charge of the entity doing the tokenization I could be staying at the premises of the private companies that lease the planes and helicopters and hold the contracts to do the actual firefighting. My hope was that being identified as the 'owner of the planes' eventually the crew would allow me to fly the missions as a +1 even though I don't have the licenses. But never crossed my mind that this could be make me a millionaire
mmooss 3mo ago
> Real World Assets (RWA) is the hot stuff these days. > Uniswap and Aave have been chugging along for years How hot? I haven't heard of it or them, but that's hardly strong evidence. What do you see? > One of the reasons is that any infrastructure built on blockchain is reusable for free by everybody Does that have an impact? I doubt consumers care about free. They certainly care about high levels of integrity (my money is safe) and availability (I can access my money), as well as profit (interest / gain). I've never heard a consumer say, 'I use Bank Z because their financial operations run on FOSS.' Mega-banks would seem to dislike FOSS. They want barriers to entry; they will find it inefficient, frustrating, and very limiting - with a significant and direct impact on their bottom lines - to deal with a bunch of amateurs. That's why you're not allowed on the trading floors, electronic or physical, and Goldman Sachs directors won't take your calls (until you establish yourself). I suspect free matters to undercapitalized startups, amateur financial services, and hackers interested in innovation in this area. But again, there's a lot I don't know ...

chrisjj 3mo ago

> We take the cow, which is a real and tangible asset, and transform it into a digital asset Fine... if you don't need the cow too.

Animats 3mo ago

"It also includes built-in safeguards that allow the farmer to swap one dead cow for a live one." Is that backwards? If you own the token for a cow, and it dies, what happens?

jt2190 3mo ago
There’s a credit agreement that will spell out those details: > To turn cattle into trusted financial guarantees or collateral without requiring inspectors to visit the property, Cowmed equips cows with an AI-powered Smarty Collar. These collars constantly monitor health, behavior, and location. The raw data is then converted into an encrypted digital identity tied directly to the B3 credit agreement. [Emphasis mine]
- kmoser 3mo ago
  I wonder what opportunities exist for a malicious actor to intercept the data flow and substitute it with their own, either for the purposes of devaluing someone else's cow or to increase the value of their own--or even to generate fake cow biometrics, feed them directly to devices, and pretend you have a real, live herd.
  - Animats 3mo ago
    It's crypto. Someone will do that.
    - goodmythical 3mo ago
      >local college student sells 11 brazillian cattle to pay off student debt
- reaperducer 3mo ago
  Cowmed equips cows with an AI-powered Smarty Collar. These collars constantly monitor health, behavior, and location. They've had these for cows in America for years, and even for people in the hospital. Long before "A.I." What makes these "smart," as compared to something like a bio button? https://www.medtronic.com/en-us/healthcare-professionals/products/patient-monitoring/remote-patient-monitoring/intelligent-patient-monitors/biobutton-multi-parameter-wearable.html https://www.medtronic.com/en-us/healthcare-professionals/pro...

jareklupinski 3mo ago

finally, economics explained by cows, so i can finally understand it

idiotsecant 3mo ago

Tokenizing physical things is kind of dumb for one reason: it's not trustless and it relies on there being a big mean cop somewhere in the transaction. Say i tokenize my couch and then sell you the the token. Suppose you show up to my house to claim your couch. I can tell you no. You can then sue me and try to get the state to send a big mean cop to get it, or it's equivalent in cash. I've yet to see a scheme that makes this trustless somehow. If you don't have that you don't have anything.

jnyst1985 3mo ago

Wait - is this finally crypto’s mass adoption event we’ve all been waiting for?