Our planet has undergone a transformation as a result of the recent development of blockchain in the information and communication sector. It can be summed up as a ledger of transactions that are recorded and stored by participants on electronic media.
Increasing accountability, openness, and trustworthiness of data kept in the chain system is the primary goal of blockchain technology. Blockchain is regarded as a crucial component of contemporary farming practises through cryptocurrencies as a result of technological advancements.
Digital or virtual currencies that use encryption are known as cryptocurrencies. They enable secure internet transactions without the assistance of outside middlemen.
The usage of public-private key pairs, elliptical curve encryption, and hashing functions are just a few examples of the encryption and cryptography techniques known as “crypto” that are used to secure these entries. Let’s now examine how blockchain technology is used in agriculture.
A simple definition of a blockchain is a ledger of transactions that are recorded and preserved by participants on electronic media.
Increasing accountability, openness, and trustworthiness of data kept in the chain system is the primary goal of blockchain technology. Blockchain is now regarded as a key component of contemporary agriculture practises thanks to technological advancements.
The use of blockchain in farming or agriculture is a way to increase the amount of reliable information that is available about stock, agricultural contracts, and the general health of the farms. Blockchain has the ability to drastically alter the current expensive process of collecting this kind of information.
Thanks to blockchain in farming or agriculture, it is now possible to continuously trace the provenance of numerous commodities and enhance the quality of the food supply chain while maintaining customer and farmer confidence.
It enables the application of multiple data-driven technologies to usher in the era of smart farming because it is a reliable and trusted method of data storage. When used in conjunction with the idea of smart contracts, it improves the efficiency of transactions involving numerous parties by ensuring that everything happens on schedule.
Application of Blockchain in Agriculture
Smart farming or smart agriculture is a practise that makes use of a number of recent technological advances to improve the productivity and dependability of the agricultural process.
It integrates technologies including information and communications technology (ICT), the internet of things (IoT), various sensors, machine learning, and a variety of data collection and analysis tools like unmanned aerial vehicles.
Decentralisation is by far blockchain’s greatest asset when it comes to smart agriculture. Additionally, this functionality makes it easier to distribute data to numerous stakeholders’ screens while preventing data loss and distortion. All transactions on a blockchain are time stamped to guarantee transparency.
One illustration is how government organisations regularly manage and regulate environmental monitoring data while keeping their own interests in mind. This gives them the authority to embellish the truth in order to arrive at conclusions that serve their ends.
Food Supply Chain
The globalization-related pressures have resulted in the longest and most intensive agricultural food supply chain in history.
The current food supply chain is faced with a number of difficulties, including issues with food quality, safety, trust, and traceability as well as supply chain inefficiencies. This puts customers’ health in danger in addition to burdening the economy and society.
By making it easier for producers and customers to create confidence, blockchain technology aids in the resolution of many of these problems. Offering detailed product information within the blockchain can greatly increase process transparency.
This has broad implications for both businesses and farmers. It gives companies the ability to increase the value of their products and, as a result, their competitiveness in the market.
Furthermore, if these practises persisted, it would be exceedingly unlikely for sellers of subpar or dishonest goods to be able to survive in the market for very long.
In recent decades, climate change has made the entire agricultural process more precarious. Extreme weather conditions affect the quality of both crops and cattle. Plans for agricultural insurance are viewed as a good approach to deal with farming’s unpredictable nature by the majority of farmers.
Farmers are eligible for a payment if their farms suffer losses owing to weather abnormalities after paying a small insurance fee at the beginning of each cropping cycle. This gives farmers some breathing room while they manage the ambiguity brought on by weather changes.
Farmers can select from a range of insurance plans that vary in terms of how compensation are determined for losses and how they are calculated. A typical type of agricultural insurance known as indemnity-based insurance pays farmers according to the conclusions of a professional who visits the farm to assess the damage.
Transaction of Agricultural Products
The buying and selling of agricultural products on e-commerce platforms might be significantly sped up with the usage of blockchain technology. This area gains from it in two ways:
- Information security
- Controlling the supply chain
Blockchain offers the vital feature of private key encryption, which is essential for information security and improves the reliability of the authentication procedure. This can help with the safe and secure application of every piece of information gathered during the planting and harvesting processes.
By reducing signalling costs for all parties involved, blockchain contributes to greater overall efficiency in supply chain management.
Although blockchain technology is still in its infancy, it has already yielded an incredible number of advantages in such a short amount of time. If used effectively, blockchain has the power to totally change the agricultural industry.
The dependability and effectiveness of this approach are probably going to get better as technology advances.