A World First: Farmers Tokenizing Dairy Cows Provide Collateral on National Exchange
Brazilian farmers have achieved a first in the world of finance by tokenizing dairy cows to bypass bank credit limits and using them as collateral on the national exchange.
Agricultural producers in Brazil’s Paraná state turned to an innovative method to overcome strict credit restrictions on small businesses by local banks. As part of the digitization of Real-World Assets (RWA), farmers tokenized 10 dairy cows and listed these assets on B3, the country’s national exchange. By securing approximately $20,000 in credit through this method, the producers marked a global first in livestock tokenization.
Digital Collateral with AI-Powered Collars
Cowmed, the agricultural technology company providing the technical infrastructure for the process, equips the cows with AI-powered smart collars called Smarty Collar. These collars monitor the animals’ health status, daily behavior, and location in real-time. The resulting data is converted into an encrypted digital identity and integrated directly into the credit contract on the exchange. Thus, the physical cow, as a tangible asset, becomes a reliable digital collateral without the need for an auditor.
The continuous tracking system enhances security by preventing the same animal from being used as duplicate collateral for multiple loans. Additionally, the system offers a flexible structure that allows a deceased cow to be replaced with another live one in the event of potential livestock death. Cowmed currently monitors 100,000 cows across more than 1,000 farms; if 20 percent of this network adopts the tokenization model, it is projected that $77.6 million in new credit volume will be provided to the agricultural sector.
Trillion-Dollar Expectations in the Tokenized Asset Market
According to data shared by McKinsey & Company, the tokenized asset market is expected to reach $4 trillion by 2030. Standard Chartered estimates this figure could hit $30 trillion by 2034. While the total tokenized asset value is at $25 billion as of March 2026, this move in Brazil demonstrates how the RWA ecosystem can push the boundaries of traditional finance.