Commodity tokenization in Argentina: an opportunity to boost the market and promote financial inclusion
Technological innovation continues to advance by leaps and bounds in Argentina, and the tokenization of commodities is presented as a new opportunity to boost the market and promote financial inclusion in the country.
The adoption of solutions based on blockchain technology opens the doors to new business models and offers significant improvements in key sectors of the economy.
Tokenization in the field of commodities has great potential, Tulio Nuñez, Head of Legal & Compliance at Koibanx -a leading company in financial innovation by providing blockchain infrastructure in Latam- explains: ” Through the private offer of certificates of deposit ( CD) in token format, assets such as gold, oil, grains, and other commodities can be digitized. Settlement and Clearing Agents, authorized by the National Securities Commission (CNV), may intervene in the settlements and clearing of these operations. The tokens that represent the CDs are considered negotiable securities, as long as they comply with the characteristics established by law .
Commodity tokenization offers significant benefits, such as transparency and traceability of each token on the blockchain.
The information registered in the blockchain guarantees the integrity of the investment and allows investors to verify the status of their assets at all times. In addition, it reduces costs and increases the efficiency of transactions, which facilitates the commercialization of illiquid assets and contributes to increasing confidence in the market.
TOKENIZE AGRICULTURE AND INDUSTRY
The agro-industrial sector continues to consolidate as the main segment in boosting the income of foreign currency to the country. The Ministry of Productive Development of the Nation estimates that close to 50% of Argentina’s exports come from commodities linked to this sector.
In this sense, tokenization comes to provide greater dynamism and the possibility of further growing this key business for the country.
A report from the Rosario Stock Exchange revealed last year that 65 out of every 100 dollars exported in Argentina come from agriculture , in this context the Agrotoken proposal is consolidated.
“We seek to make the value of natural resources accessible to everyone, this is tokenize or convert real crops such as soybeans (SOYA), corn (CORA) and wheat (WHEA) into cryptoactives. A token is equivalent to a ton of the same cereal that is reserved in a collection. Each ton is validated through the PoGR (Grain Reserve Test), which is transparent, secure, decentralized and auditable at all times”, explains Eduardo Novillo Astrada, CEO and co-founder of Agrotoken.
The company’s infrastructure provides various options to operate on a daily basis using the tokenized harvest as backup, since 80% of its users use their agrotokens to buy inputs such as seeds and fertilizers, but it can also be used as credit collateral, pay through the Visa Agrotoken card, in more than 100 million businesses in the world, in an easy, transparent, efficient and secure way.
But Argentina, in addition to having been a pioneer in linking the agricultural world with cryptocurrencies, has great opportunities to tokenize other key commodities for the country’s development, such as lithium .
According to official data, exports of this mineral tripled in just one year, reaching USD 696 million in 2022.
In this sense, the potential to generate more opportunities for new small investors to enter this segment through tokenization is enormous.
There is also much still to be explored in the livestock, oil and gas industry, where projects are already beginning to emerge that seek to promote the productive development of the country.