A Swiss agricultural startup has piloted the use of a non-fungible token for cutting down the costs of trading grain. The system implemented by Swiss firm Cerealia SA sees the tokens reportedly backed by 30,000 metric tons of Mexican white corn.
Although the Cerealia platform only facilitates two-way deals at the time being, an upcoming addition will allow for third-parties to trade and speculate on grain deals using the token. A digital system naturally reduces the costs incurred by grain traders in executing deals, such as storage fees, while reducing the onus on paperwork.
The tokens were reportedly used by Mexican firm Mercanta, representing grain it had stored at a local warehouse. Other grain holders and trade houses can issue their own version of the token, which can then trade on Cerealia’s platform while acting as a marker for actual grain held.
Cerealia chief operating officer Filipe Pohlmann Gonzaga said the tokenized system could open up digital grain trading to the likes of banks, hedge funds and other investors, without them having to take physical delivery of the grain.
Cerealia has reportedly attracted buying interest for around 6 million tons of grain since it launched in November 2020, according to BNN Bloomberg. The firm has a presence in close to 30 different countries, including Brazil, Egypt and Ukraine, and is expected to expand into Singapore and sub-Saharan Africa next.
Read More: cointelegraph.com