Russian farmers’ co-op LavkaLavka was one of the first to launch an ICO (November 1, 2017). The company attracted around $500,000 on its own platform biocoin.bio on the first day of the coin offering, sources said citing founder of the co-op Boris Akimov. The company raised more than $11.8 million as of February 6. One billion BioCoins were issued during the ICO, 800 million coins were available for the purchase by investors. Investors will be able to exchange BioCoins for agricultural goods.
Khokholskaya Agricultural Company (KAC) aimed to attract 4 billion rubles of investment through an ICO. The company planned to issue MilkCoins and use the funding to reconstruct the farm and purchase equipment. Unfortunately, KAC attracted only 2% of the planned amount and returned all the money to the investors. Experts say that the project may have failed due to lack of international experience of the team, they criticized the landing page of the project and the concept, as a business project based on the production of milk alone; it is not likely to be of interest to crypto investors seeking sky-high profits.
Russian Agrarium ecosystem launched MeatTokens backed by beef meat last July. It works as follows: when a farmer has 10 cows, and they are willing to sell them, Agrarium tokenizes them, issues respective tokens, and offers investors these tokens. An investor chooses an asset (animal) and purchases a token, when the meat is processed and sold, investors receive dividends, withdraw the investment or continue to invest. Agrarium purchases the tokens back from investors in 6 months at a price, which is 14.5% higher compared to the initial one, the annual dividends stand at 29%. Any farmers may participate in the project, it already unites farmers from various Russian regions, such as the Republic of Tatarstan, Perm Region, Moscow Region, and others. So far, Agrarium sells only meat through this platform, but it is going to add other agricultural goods to the project soon.
Eduard Surkov’s farm is located in the Tver Region. His project implies that one token is equal to one animal. An investor pays money and receives a token that has, for example, a goose, a chicken or a cow behind it. Libre.Life company helped the entrepreneur launch the project back in 2017, but they did not manage to raise as much investment as they would like to. Surkov says that cryptocurrency investment in agriculture is not a major trend, but they are planning to continue to develop the project.
Mikhail Shlyapnikov grows young plants in the Moscow Region. He raised 401 bitcoins ($510,500) through an ICO last year. Experts say his success is due primarily to marketing and the image of an anarchist who resists the government rule, which triggered investors’ interest.
Will agriculture attract more cryptocurrency investors? The advantage of the sector is that tokens issued by agricultural producers are backed by real goods, and investors understand what is behind their growth. Also, most agricultural producers have been doing business for quite a while, their ICOs are not likely to be about hype alone, but rather about specific projects with clear goals. Meanwhile, cryptocurrency investors are mostly interested in extremely profitable projects, and this may not be the case of the agricultural business. It could be though, if business owners are ready to make their projects turn into a prominent part of the global economy, present them on the international level, expand them until the turnover reaches the global scale.