How Blockchain Technology Can Transform Agriculture?
Blockchain is one of the trending technology in the IT field which shows a bigger revolution. In recent days, the blockchain has started to influence the dynamics of the agricultural industry as well. Thus, agriculture is a little-known industry that blockchain has the potential to revolutionize. More importantly, it has an increasing number of challenges that require immediate attention. Blockchain technology has several applications in agriculture.
We will discuss the blockchain in the agriculture sector below.
Blockchain In Agriculture
In agriculture, blockchain is being utilized to help increase the quantity of trustworthy data available about inventories, agricultural contracts, and the overall state of the farms. Gathering this type of data was a costly endeavor, but blockchain has the potential to change the future.
Owing to the blockchain in agriculture, it is necessary to increase the quality of the food supply chain and remain the trust among the customers and farmers by tracing the origins of different foods on a regular basis.
It enables the facilitation of numerous data-driven technologies to assist in the era of smart farming because it is a reliable and trusted method of storing data. It helps to smooth the nature of transactions between many stakeholders by making things more timely when combined with the growth of smart contracts.
Transactions of Agricultural Products
The use of blockchain technology can considerably improve the acquisition and sale of agricultural products on e-commerce platforms.
It is beneficial to this section in two ways.
- Information security
- Supply chain management
Blockchain helps to boost overall efficiency by lowering the cost of signaling for all parties involved in the role of supply chain management.
Furthermore, by providing digital payment solutions with no transaction fees, blockchain adds to the security of the payment process. Cryptocurrencies will help to lower transaction costs even more.
All of this contributes to increased consumer confidence in the online purchase of agricultural products. Farmers will reap various benefits which include more revenue and a larger internet audience for their products.
Benefits of Blockchain In Agriculture
The benefits of blockchain in agriculture are as follows:
- Blockchain technology in agriculture allows peer-to-peer transactions with extreme transparency and eliminates the need for a middleman.
- The absence of a central authority figure alters the transaction's nature of trust. Trust is placed in peer-to-peer systems and cryptography rather than in an authority.
- Blockchain technology aids in the improvement and restoration of trust among various stakeholders, such as customers and producers. This may assist in lowering market transaction costs in the long term.
- We now have a solid means of consulting transactions between numerous anonymous users due to blockchain technology.
- Any cases of blockchain faults or scams are straightforward to detect and report. Smart contracts also make it simpler to notice any problems in real-time.
- Blockchain technology makes it much easier to track things throughout a large supply chain. This gives customers peace of mind about the safety and quality of the items they eat.
- Within a blockchain environment, there is more transparency in all transactions. The data gathered with this method is extremely dependable and traceable. This aids in the development of various data-driven insurance choices and makes farmers less vulnerable to agricultural risks.
Drawbacks of Blockchain In Agriculture
- All the transacting parties' reasons for providing the correct information in the blockchain ledger should be investigated thoroughly. This is particularly for small-scale farmers.
- Depending on the size of the farm, the total technological advancement of implementing blockchain may vary. While small farms find it easier with blockchain-based insurance, larger farms find it easier to collect and integrate various sources of real-time farm data.
- The process of transferring data to a blockchain is considered to be costly. Farmers who cannot afford a blockchain face a significant hurdle to adoption. While the cost of setting up the ledger is low, the process of collecting data can be time-consuming and cost-effective.
Lets take about the most important topic, the use cases of blockchain in agriculture.
Use Cases of Blockchain in Agriculture
In this article, we are discussing the use-case of blockchain in agriculture:
- Crop and food production
- Food supply chain
- Controlling weather crisis
- Managing agricultural finance
Let us have a brief look at the use cases of blockchain in agriculture,
Crop and Food production
Blockchain can alter the way crops or food items are produced with the following process:
- Data is generated by IoT devices.
- Cleaning and enrichment of the information gathered
- Using machine learning algorithms to make data more insightful
- The blockchain is used to store data.
Food Supply Chain
Blockchain food supply can prevent food fraud with the use of the following methods such as,
- IoT sensors creating data or farmers saving data.
- Distribution of produced crops to food processing companies.
- Wholesalers and retailers get processed food.
- The supply chain can be traced by consumers.
Handling Weather Crisis
Farmers can mitigate weather crises with the use of three processes.
- Agricultural weather stations are transferring vital data to the blockchain.
- Farmers can take precautionary measures.
- Crop insurance can be applied quickly.
Managing Agricultural Finance
With two steps, blockchain can assist in handling agriculture finance,
- Information sharing among stakeholders at every stage of food production
- Auditors are capable of conducting audits efficiently.
Advantages of Implementing The Blockchain in Agriculture
The advantages of implementing blockchain technology in agriculture are as follows:
- Enhanced food safety and quality control
- Greater productivity for farmers
- Higher supply chain traceability
- Farmer's payments that are more equitable
Future Scope of Blockchain in Agriculture
Blockchain is a rapidly developing technology. even if it has started to transform several industries, it still has a long way ahead. However, it is becoming increasingly evident that blockchain technology has applications in the agriculture industry. The global agriculture industry is currently valued at more than 2.4 trillion dollars and employs more than one billion people. There is more opportunity for creativity than ever before.
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