Key facts
- Ten cows at Fazenda Engenho Velho in Imbituva, Paraná, backed a R$100,000 CPR-F loan registered on B3.
- This is the first tokenized livestock collateral formally accepted on Brazil's stock exchange.
- Each cow was given a unique blockchain ID generated from AI-sensor collar data.
- The system eliminates the need for in-person farm inspections and reduces steep discounts banks apply to livestock collateral.
Ten cows on a dairy farm in Paraná, Brazil, have become the first livestock collateral formally registered on the country's stock exchange, B3. This innovative deal utilizes blockchain-tracked animals wearing AI-powered sensor collars to secure loans, addressing a critical need for farmers facing financial difficulties.
Fazenda Engenho Velho in Imbituva used ten cows, valued at R$120,000, to secure a R$100,000 CPR-F loan from BMP, a direct credit company. BMP then sold these credit rights to Target FIDC, a fund that specializes in monetizing receivables, which subsequently registered the transaction on B3.
Each cow was assigned a unique encrypted digital ID derived from health, behavioral, and location data captured by smart collars from agricultural tech startup Cowmed. This cryptographic hashing of data creates a tamper-resistant identifier linked to the credit contract, eliminating the need for traditional, costly, and often discount-heavy farm inspections.
Banks typically discount livestock collateral by up to 60% due to the difficulty in verifying an animal's condition or existence. Humberto Brenner, director at Target FIDC, stated that real-time monitoring removes this uncertainty and meets the increasing demand from banks for reliable collateral and new data sources.
The initiative comes as Brazil's agribusiness sector faces a credit emergency, with bankruptcy protection requests nearly quadrupling between 2023 and 2025, driven by high interest rates, falling commodity prices, and climate shocks. Cowmed CEO Thiago Martins highlighted that transforming tangible assets like cows into digital assets monitored in real-time provides farmers with advantageous financing opportunities and new collateral alternatives during a period of tight credit.
This operation aligns with the broader trend of tokenizing real-world assets (RWAs), which has seen significant growth in areas like tokenized U.S. treasuries and real estate. Cowmed currently monitors 100,000 cows across 1,200 farms globally, with an estimated value of R$2 billion. Martins projects that 20% of this herd could be pledged as tokenized collateral within two years, with companies targeting R$5 million in credit through this model by the end of 2026.