Brazil B3 registers first loan using tokenized dairy cows

A dairy farm in southern Brazil has become the site of a financial first, using cows monitored by smart collars as tokenized collateral for a loan registered on the country's national stock exchange. This transaction, involving ten dairy cows, marks the first formal acceptance of tokenized livestock as loan collateral on the B3 exchange, introducing a novel financing model for agricultural producers facing credit constraints.

The pioneering deal centered on Fazenda Engenho Velho in the state of Paraná. Ten dairy cows, valued at approximately 120,000 Brazilian reais (around $23,500), were used to secure a loan worth 100,000 Brazilian reais (around $19,600) through a Financial Rural Product Note. The transaction was structured by the investment fund Target FIDC and registered on the B3 platform, providing a formal mechanism for using digitally identified livestock in financial transactions.

Key to the process was technology from the agricultural startup Cowmed. Each cow was fitted with an AI-powered smart collar that continuously monitors the animal's health, location, and behavior. This real-time data is converted into an encrypted, unique digital identity for each animal, which...