Tokenizing Agricultural Futures in Blockchain: New Business Opportunities for Small and Medium-sized Enterprises

Deyan Paroushev and Petko Ruskov
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Deyan Paroushev: Sofia University St. Kliment Ohridski, Sofia, Bulgaria
Petko Ruskov: Sofia University St. Kliment Ohridski, Sofia, Bulgaria

Innovative Information Technologies for Economy Digitalization (IITED), 2024, issue 1, 61-69

Abstract: Small and medium-sized enterprises (SMEs) in the agricultural sector are often excluded from institutional futures trading markets due to minimum volume requirements and complex access procedures. This study presents an innovative tokenization model that enables SMEs to collectively participate in futures trading by pooling smaller quantities into standard contracts. Using blockchain technology, the model creates a transparent system for aggregating small volumes into standard futures contracts. Results indicate significant risk reduction for SMEs and improved access to risk management tools. Economic analysis reveals potential revenue increases of 8-10% through elimination of intermediaries and direct futures market access. This approach has the potential to transform SME participation in global agricultural commodity trading.

Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:nwe:iitfed:y:2024:i:1:p:61-69

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