News / Habanero Cryptocurrency - Agrocoin

Habanero Cryptocurrency - Agrocoin

Habanero Cryptocurrency - Agrocoin

26 March 2018 News 1

This week we learned that habaneros are on the blockchain!

If you don’t understand that statement, this article goes over some blockchain basics while exploring one use of the technology here in the Yucatan. Please leave any questions in the comments!

To raise capital from small investors wanting to invest in their habanero farm, pepper producer Amar Hidroponia is selling digital “Agrocoins” each representing a square meter of their production operation. Company President, Rodrigo Domenzain, said they were looking for a way to attract smaller investors.

Each 500 peso ($27) Agrocoin is backed by a square meter of hydroponic production in Quintana Roo state.

Transactions like this rely on a distributed ledger to record information, such as changes of ownership. Every transaction is copied across all the other ledgers--the blockchain--in the system. In this way, there are clear records of all transactions which simplifies bookkeeping and trust issues. Your "coin" is a ledger entry, which can't be duplicated or altered. Bitcoin and Ethereum, two of the most popular cryptocurrencies, are built on this principle.

"The company says it expects to pay a yearly dividend equal to about 30 percent of the cost, depending on output and demand."

One big difference seems to be that owning Agrocoin is functionally more similar to future than digital currency. The source article states the farm proposes issuing 1 million coins. Suspiciously, the Agrocoin website cites a figure of 10K in vaguely worded statement (screenshot at right). If each square meter is backed by an Agrocoin--worth $27--is the market cap $27K, $27M or somewhere in between?

Without that physical, agricultural space to back the Agrocoin, what are we buying?

This issue seems to leave open the possibility for manipulation by the company through coin production. That isn't the only issue that requires clarification. For example, how will the habanero market price affect the value of Agrocoins? Will dividends be issued in Agrocoin or fiat currency? What is this clock on their homepage which ominously counts down to Tuesday April 17th?

We don't have all the answers and won’t make financial recommendations, but this is one example of a potential use for blockchain technology and we're excited to watch it develop. If you have any more info about this topic, send it our way!

We will update this article with new information as it becomes available.

Leave your thoughts in the comments and THANKS FOR READING!

DISCLAIMER We aren't associated with Amar Hidroponia in any way. All of the information comes from their webpages and a Bloomberg article.

We aren't recommending any investment strategies. We are simply interested in applications of emerging technology in the Yucatan.

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