The technology behind the famous Bitcoin – Blockchain, is creating a tech fever recently. It is expected to have a variety of applications in different fields including agriculture.
See also: Blockchain application in Medical
Blockchain is a peer-to-peer network of hundreds to millions of personal computers linked together to create a distributed ledger. So what can this network do for the agricultural sector ?
Traceability
Traceability
Blockchain will solve the problem of validation and authentication information. Every transaction made along with its information and participated parties will be public for others to verify. Blockchain can also be the “one-time” solution for the trust issue. The information related to the products and transactions will be stored permanently in the system. People can easily track the origin of the goods, its supplier, and even the carrier or name of the ship that once involved in the transportation process.
Learn more: Blockchain application in Education
In addition, the information in each blockchain block is designed to be immutable and needs to be verified by all nodes in the system, which made it trustable. This not only creates a high-quality-standard for agricultural products but also helps in increasing sales as consumers are no longer need to worry about products’ quality.
Financial instruments
Financial instruments
Using blockchain as a financial instrument in agriculture offers tremendous benefits for both suppliers and consumers. The blockchain platform will allow everything to be done automatically, which minimizes the cost of conventional manual operation. Moreover, blockchain 2.0 or advanced provides smart contract – an application of Blockchain minimizing errors during the trading process. Eliminating intermediaries, the agriculture sector can save up a lot from cutting costs.
Smart contract is a wise choice to avoid risks and to ensure farmers’ benefit. Trading will be much easier for producers, distributors, and sellers with the help of this technology. Full or partial contract payments can be made immediately through the confirmation and enforcement of the blockchain system. This would also allow farmers to be paid in full without breach of contract.
Increase the export value of agricultural products
Increase the export value of agricultural products
Import and export process is quite complicated with unnecessary procedures and intermediate stages. Payments are often made in foreign currencies such as US dollar, which can be risky and costly due to inflation and fluctuation. As a result, transaction costs in international commerce can be up to 15% -20% of the total value of the goods, which is a disadvantage for both exporters and importers.
Learn more: Blockchain application in Finance
The application of blockchain in general, as well as smart contract in particular, has set out a new path for international commerce. Blockchain will minimize complicated procedures, saving time, effort, money for users, as well as create “social capital” that allow strangers to transact with each other. All transactions can be done quickly and easily with high accuracy and security. Payment will be made and contracts will not be violated with the help of Blockchain.
Applying high technology to agriculture has great effect and blockchain is no exception. The blockchain is the future of agriculture as it will reduce costs and enhances efficiency. In Vietnam, blockchain technology is gradually going into deployment but has yet caught up with others strong competitors in exporting agricultural products. It may be necessary to wait until the blockchain completely replaces the old management system to truly see the changes in agriculture in Vietnam.
