28 Feb Livestock Auction
Onsite livestock auctions require considerable cost and time investment for both buyer and seller. Payment is directed through a third-party auctioneer creating risk and cost.
An online auction platform for direct peer-peer settlement of livestock transactions. Programmable payment allows automatic payment of fees and levies to livestock associations.
CBDC enables faster settlement with a risk-free settlement mechanism
Onsite livestock auctions require sufficient stock for an entire transport and incur high costs: two transport journeys, feed, auction yard fees and labour costs. Financial settlement occurs separately creating risk. An online auction platform with programmable CBDC payment enables settlement directly between buyer and seller with no counter-party risk. CBDC automatic multiparty payment pays seller and associated auction fees on delivery reducing costs to end user and administrative burden.
The pilot conducted an online livestock auctions with specific lots identified for participation in the pilot. A small number of recruited wholesale buyers pre-funded wallets with pilot CBDC. Buyers could see their credit balance through the auction online app. On auction completion, the auction operator (Farmgate) triggered a multiparty settlement in pilot CBDC with credits to the seller (less fees to Farmgate and Fame) and debits to the buyer (sale value plus fees to Farmgate and Fame).