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This Blockchain Startup Ties Coffee to Crypto

If you dropped by Starbucks for a free cup of coffee on National Coffee Day, you would instead have been greeted by signs about the company's supply chain, ethical sourcing commitments, and support for coffee farmers.

This Blockchain Startup Ties Coffee to Crypto

Rather than being handed freebies, customers were invited to pause and consider the global economy of the caffeinated bean, one of the world's most valuable agricultural products from the tropics.

Most of the world’s coffee is grown by small farmers, many of whom depend on family labor and unreliable income - often less than $2 a day, the World Bank says. In fact, 25 million of these farmers produce an astounding four-fifths of the world’s total coffee supply, according to the U.K. non-profit Fairtrade Foundation.

Now there’s a tech startup that wants to change the economics. Bext360, a year-old Denver-based company, is applying technology, like robots, mobile apps, and blockchains — the shared accounting ledger technology that paved the way for Bitcoin’s rise — in order to, as it says, “improve the upstream supply chains of key commodities,” starting with coffee.

It works like this. The firm builds big, sensor-laden machines to sort, weigh, and assess the quality of each coffee cherry plucked on a plantation. The devices analyze and grade the fruit based on its condition (riper, larger cherries generally fetch a higher price). The resulting data — weight, grade, and other specs — are made visible to buyers who then bid on the beans.

“We’re trying to provide more and more data at the farm level to make it more like the wine industry,” says Daniel Jones, CEO of Bext360. He wants farmers to get paid “not only on quantity but on quality of yield,” he says.

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