Overstock subsidiary Medici Ventures is investing in a software firm looking to store grain transactions on a blockchain.
The company announced Tuesday it was purchasing $2.5 million of equity stake in GrainChain, a nearly six-year-old company which develops software tools to aid farmers and purchasers in the grain industry. Medici’s purchase gives it a 10 percent ownership stake in the company, with the option to purchase another 10 percent at a future date.
While GrainChain originally developed internet of things-focused software, CEO Luis Macias told CoinDesk that the company began looking into utilizing a blockchain ledger about two years ago.
At the time, the company’s systems were having issues coordinating with “thousands of trucks on a daily basis,” due to the number of contracts that had to be filled out and executed manually.
To combat these issues, the company is developing a blockchain platform that makes it easier to track grain and connect with a larger set of buyers, Macias said.
“What it’s doing is not only leveling the playing field for the farmer but … giving a more accurate vision of where that grain is coming from, how it’s being paid and how it’s moving through the market. It’s eliminating the need for multiple-tier middlemen in the industry.”
There are roughly 500 farmers piloting the network right now, with another 3,000 or so on a waiting list, he said. The company expects to go live with the platform by the first quarter of next year.
In addition to grain tracking, the platform utilizes a token, dubbed GrainPay, to facilitate payments. The dollar-backed stablecoin is meant for internal use only,