A Brazilian farm tokenized 10 cows with real-time monitors, securing a $20K loan. The deal, registered with B3, could open the door to $78.5M in farm credit, Cowmed said.
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A farm in Paraná, Brazil, took out a loan of nearly $20,000 using 10 cows as collateral. Each cow was tokenized on a blockchain and monitored in real time with smart collars from Cowmed, an agtech company. The transaction was registered with B3, the Brazilian exchange, as a Financial Rural Product Note (CPR-F).
BMP, a direct credit society, issued the note. Target FIDC, a fintech, registered the tokenized cows as receivables. The monitoring lets creditors check the herd's health at any time, lowering the risk of default.
Humberto Brenner, a director at Target FIDC, said the transparency can push a cow's collateral value to 2.5 times what it would fetch in a normal agreement. “Monitoring eliminates that uncertainty,” he told Valor International.
Thiago Martins, CEO of Cowmed, said this was the first such transaction registered with B3, which is also preparing to launch tokenized stock trading. “We took the cow, which is a real, tangible asset, and turned it into a digital asset backed by a unique code monitored in real time. This digitization allows formal registration with B3 as a movable asset,” he explained.
If a cow dies, the farmer can substitute another, as long as the collateral stays at 120% of the loan value. Martins said the structure gives farmers access to cheaper credit and higher limits. “We want to connect farmers and financial institutions through a new alternative,” he said.
Cowmed's system tracks heat cycles, health changes, and feeding patterns for over 900,000 cows on 1,400 farms. Martins expects 20% of its monitored herd to be used in loan transactions within two years, with a total credit volume of $78.5 million.
The Brazilian securities watchdog, CVM, is preparing an experimental regulatory regime for securities within the next 60 days. That framework could cover more tokenized real-world assets. crypto market analysis has more on the broader trend.
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