The Path to DAOCoffee

CoffeeDAO is a platform developed by the NFT-DAO, a global community of individuals who are enthusiastic about the potential of blockchain technology and interested in applying it to real-world applications.

The project has been in development for nearly nine months. It took considerably longer than anticipated to simply build a new platform, but this is understandable given that we also re-engineered a coffee distribution supply chain while attempting to deliver something novel to the blockchain industry.

CoffeeDAO was born with three objectives. 1) Demonstrate the utility of NFTs outside of the realm of media distribution; 2) Improve conditions for coffee producers; and 3) Demonstrate worldwide collaboration on a project by Cardano community members.

The Case for Non-fungible Tokens

The world of non-fungible tokens is stagnant and losing much of its potential for innovation. Many of the most prominent NFT projects are down 90 percent, and the entire industry is being dragged down by a handful of high-profile scams.

In this context, CoffeeDAO emerges as a project that seeks to enhance the utility of NFTs. For the Arabica variety of coffee, standard contracts known as C-contracts are used in the commodity market.

The C-contract specifies the coffee species, bean size, quantity to be traded, and delivery requirements. The absence of coffee quality among these details has given rise to a parallel industry of specialty coffee.

In specialty coffee, in addition to the standard contract fields, there is room for quality. Coffee is graded on a scale from 60 to 100, and crops with a grade of 80 or higher are considered specialty coffee.

These contracts can be extremely valuable, but they are difficult to establish because there are no open markets for them. Here, non-fungible tokens are introduced into the picture.

In the case of specialty coffee, the NFT is an excellent tool for capturing uniqueness, as it can indicate the quality of a coffee crop. This would dramatically increase the accessibility of a market that is normally conducted over the counter and is difficult to access.

The CoffeeDAO project has developed the first template for this type of contract, which we refer to as an Origin Certificate. It can be used as the foundation for a new method of trading coffee based on NFTs and blockchain transparency.

The Coffee Producers

Additionally, coffee producers are affected by the C-contract. The standard coffee contract is used to benchmark coffee prices around the world, but because it does not account for quality, it acts as a mechanism to depress prices for growers seeking to produce high-quality coffee.

This has significant repercussions as 80 percent of coffee is grown by small and medium-sized producers, who are primarily family-owned. This means that 125 million people worldwide rely on coffee for a living.

Improving the market for these cultivators is essential for enhancing their lives and futures. The coffee industry has been mired in the past for too long and requires a complete overhaul.

We have chosen to work with coffee farmers in Honduras for this reason. Historically, the country has been a major exporter of coffee, and its coffee growers produce some of the highest-quality crops in the world.

Specifically, we source single-origin coffee from Comayagua, a mountainous province in Honduras. The region has a long history of coffee cultivation but is relatively unknown in coffee circles.

We believe they are the ideal location for the CoffeeDAO pilot because they are able to source exceptional coffee and we can help increase the visibility of their coffee.

EMURGO Academy

Another highlight of the CoffeeDAO project is that all the developers met via EMURGO Academy. The last part of the program, Cardano Solutions Architect, requires a dApp on the Cardano testnet as the final project.

Our team of developers all came together through the final project for EMURGO Academy as the first graduates to finish the entire Cardano blockchain developer track.

Once there was an initial prototype for EMURGO Academy, we took it and expanded it into a full production dApp. The CoffeeDAO platform exhibits a dApp created by first-time Cardano developers and was possible thanks to what we learned.

It finalizes a long journey but also marks the start of another one. As all of us on the team look forward to expanding our careers in the Cardano ecosystem