Coffee Coin: A Cryptocurrency Backed by Coffee Stocks

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Cryptocurrency Coffee Coin

Coffee Coin or COF is the first-ever currency backed by coffee stocks. Its rates are adjusted by the fluctuating price of coffee beans in the open market, which the market regulates daily. The Coffee Coin token similarly conforms to the same commercial basis as the coffee beans.

The token was initially launched in July by Minasul, Brazil’s second-largest Arabica cooperatives. The best thing about this is that the farmers can exchange 30% of their coffee harvest for coffee coins and use them to buy other goods.

If you’re familiar with stable coins, they are currencies backed by reserve assets. This asset could be either be fiat or gold. This coin is for people like you and me.

Are Coffee Coins Safer Than Other Cryptocurrencies?

Based on observations, most cryptocurrencies are extremely unstable because their rates can fluctuate greatly.

However, the best thing about coffee coins is that they are linked to an actual asset, making it a safer investment option. These coins are associated with the market price of green coffee that is why it is less volatile than other cryptocurrencies.

In other words, we can trade/sell coffee coins for money. The minimum number of coffee coins equivalent to 1,500kg of green coffee is predetermined by Minasul, the creator of Coffee coins.

The demand of the investors influences the price of coffee coins. We can also invest in trading at StonoEx, a partner in the Minasul Cooperatives project.

What is the Trend of Coffee Coins in the Market?

After its launch in the market in July 2021, it saw an increase of more than 35%, which is a good start for the recently launched cryptocurrency. The main reason for this increase was a decrease in coffee production in Brazil.

The bad weather hit the coffee crops, causing damage to more than 30% of the coffee production and rising coffee prices. The Coffee coin’s price increased because of its association with coffee beans.

Who Uses Coffee Coins?

The Coffee coins allow us to buy coffee stocks with just a click of a button, which can undoubtedly result in far-reaching changes in how the coffee market and its participants operate in Brazil.

As Brazil is the world’s leading coffee producer, traders from all over the world keep a close eye on the coffee cash.

Are Coffee Coins Worth the Investment?

coffee coin

Because of its connection to the market value of green coffee, this cryptocurrency is much less prone to fluctuation than the others.

The price of other cryptocurrencies like Bitcoins and Dogecoins can be affected by hypotheses and, on occasion, celebrity tweets. It is also a secure investment, as it is backed by physical assets and a significant coffee cooperative.

Can We Buy Coffee Coins Directly With Cash?

We cannot buy Coffee coins with cash. First, we need to buy another cryptocurrency like Bitcoin or Ethereum. Then, we can exchange it for coffee coins. Even if some ATMs support Coffee coins in our area, they are still less than 1% of all the cryptocurrency ATMs.

Following are some steps to buy a coffee coin:

  • You can buy a portion of Bitcoin or Ethereum from any crypto exchange of your choice.
  • In addition, you can transfer Bitcoin or Ethereum to an exchange that supports coffee coins.
  • Once the second step is done, you can finally exchange Bitcoin or Ethereum for Coffee coins.

Reasons for Buying Coffee Coins

crypto coffee coin

1. It is Not Heavily Regulated and is Less Volatile

This cryptocurrency is expected to be less volatile as they are linked with the market price of coffee. Price speculation and, on occasion, and tweets by celebrities can affect other cryptocurrencies like Bitcoin and Dogecoin.

It’s also a safe investment because it’s backed by tangible assets and a large coffee cooperative.

2. It is Redeemable and Tradable

We can always trade and redeem coffee coins for cash from cooperatives or their equivalent value in actual coffee, regardless of the secondary market price. In the latter case, the cooperative established a minimum amount of green coffee that we could trade for 1,500kg of Coffee coins.

3. Beneficial for Farmers and Cooperatives

Farmers can exchange their harvest for money or coffee coins and trade up to 30% of the crop, 20%, and 10% subsequent harvest.

According to Magalhaes, cryptocurrency adoption can reduce costs for the cooperative and farmers because they will not need to register the transaction with the notary.

4. An Excellent Option For Traders

The Coffee coins eliminate all the hassles, time, and fees linked with associating multiple currencies from customers worldwide with the help of the traditional banking system.

The transaction fee of less than one cent for any size COF payment takes only a few seconds compared to several days or more for bank transfers and significant bank fees and exchange rate fees.

5. Safe and Secure Option

Coffee coins are tokenized commodity or cryptocurrency token that represents real-world goods. This method of tokenizing a physical item allows investors who would not usually have access to sectors and gives them a secure payment option.

Since it is also backed by a commodity, it gives it a significant advantage and makes it a safe option for its users to reap the benefits.

To read more about its benefits, you can check the article on Coffee Coin: Combining the Coffee Market with Cryptocurrencies.

How to Protect Our Coffee Coins?

To protect our coins, we need to store them in a secure wallet. Leaving them in exchange is risky. You may lose all the money if the exchange gets hacked, so it is essential to use 2FA.

Coffee Coin – The Currency of the future

The combination of the coffee market and the world of cryptocurrency can lead to new and futuristic innovations in trading and business. Furthermore, this currency gives the farmers an advantage in obtaining a large share of profits in exchange for coffee.

If we look at it from the investment point of view, it is a safer investment, and speculations will not determine its price. As it is backed with actual commodities, it remains stable. Hence, I would recommend looking into investing in the coffee chain.

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