IPFS Applications | How Arbol will increase resilience to climate change

Looking back at the history of agricultural development of our human race: it has been threatened by natural disasters since primitive society, and people in primitive society placed their hopes on totems; during the feudal dynasty period, with the influence of feudal ideas such as the divine right of kings, people regarded natural disasters as the emperor's unkindness; and in today's society, we have a deep understanding of the impact of the natural environment on agriculture, and have established research departments such as astronomy and meteorology.

However, we still cannot avoid natural disasters. Although the state will provide certain economic policy subsidies, farmers still suffer losses.

If: farmers and other weather-dependent agricultural entities are connected with other weather-dependent parties, investors and other capital providers to insure and protect against weather-related risks, will they be able to obtain risk compensation more accurately and quickly after natural disasters? Today we will take you to: Arbol

At this stage, our economy is developing rapidly, but it still cannot protect farmers from natural disasters; many disastrous incidents have occurred in the past few years: before the Spring Festival in 2008, southern my country suffered the worst freezing rain and heavy snow disasters in 50 years, and traffic in many cities was blocked and power supply was stopped, causing huge losses; in 2018, Germany experienced an extreme heat wave with temperatures reaching 40°C; in 2019, Australia experienced extreme drought, and forest fires spread for miles, etc.

Especially after a natural disaster, farmers have to wait a long time to get emergency solutions such as disaster relief.

Arbol is a new insurance solution that eliminates the process of on-site damage verification for natural disasters and determines losses through objective data-driven parameters, rather than subjective losses determined through on-site verification. Arbol connects agricultural entities such as farmers and other climate parties with investors and other capital providers to insure and protect against weather -related risks.

Arbol's platform is a risk marketplace where end users can access competitively priced risk management solutions and capital providers can benefit from access to the lucrative but underdeveloped weather risk market. Because Arbol uses IPFS for its data storage and delivery needs, end users and underwriting partners can be certain that the data Arbol uses to determine contract prices and payments is tamper-proof and trustworthy.

In short, Arbol's platform benefits all participants by establishing connections between users, capital providers, and underwriters; adopting a parametric risk management approach, and ultimately eliminating the traditional insurance claims process (on-site loss assessment).

Arbol uses smart contracts and third-party weather data to automatically pay out based on weather results. Specifically, users can be divided into two groups:

The first category of users consists of entities most affected by weather. This includes: farmers, agribusiness, solar and wind businesses, shipping businesses, tourism industries, etc. This category of users uses Arbol to hedge their weather risks, thereby improving stability and growth. The scope of the group's work includes both technical complexity and access to financial resources, as organizations of all sizes can use Arbol to hedge weather risks.

The second category is financiers . This mainly includes insurance companies, banks, hedge funds, investors, and in fact anyone who hopes to earn a return by financing weather derivatives. This group has more mature technology and access to more resources.

Arbol's weather data sets range in size from 1GB to 1TB, and each data set undergoes a detailed import process before it can be used. Arbol uses index processing and associated packaging data. Once it is determined that the data set meets Arbol's usefulness and validity standards, by putting this data on IPFS, Arbol can also ensure that it has a verifiable, tamper-proof and decentralized home. The specific features are as follows:

1. Objectivity of data sources

Arbol builds its data index by obtaining large weather-related datasets from a variety of trusted public and private sources, including prominent US government agencies NASA and the National Oceanic and Atmospheric Administration (NOAA). These sources track weather data, including annual rainfall, temperature fluctuations, wind speed, and more. However, while much of the data Arbol uses is public, it is not always easy to use; much of the data, especially the deeper historical records, is stored in outdated formats and is rarely organized into an easily readable structure.

2. Data Verifiability

Contracts on the Arbol platform are linked to specific, verifiably unaltered content-addressed data. Because parametric weather risk management absolutely relies on user consent and trust in source data, Arbol’s approach provides assurances that other products on the market cannot.

3. Decentralized data transmission

Arbol uses massive datasets containing billions of files and terabytes of information. IPFS supports Arbol’s methods for publishing and adding to large datasets while still allowing Arbol to publish and sync these datasets over a decentralized storage network.

Arbol delivers weather risk management solutions through blockchain-based contracts like this one, eliminating costly payment delays and the risks associated with fraud, corruption, and bureaucratic management. It also brings the benefits of peer-to-peer decentralization: Arbol users do not need to rely on Arbol as a financial middleman, because funds are locked between end users and capital providers, and Arbol does not control the transfer of funds.

Since Arbol launched its platform in late February, the company claims that more than 350 institutional clients have signed up to use its parametric insurance platform. Meanwhile, in April, an agreement was signed for parametric and index-based catastrophe risk transfer specialist GlobalParametrics to place the power of its Natural Disaster Fund (NDF) behind a weather insurance pilot for coffee farmers in Costa Rica, which is powered by Arbol’s technology and smart contracts to drive the market for weather risk transfer.

In about four months, Arbol’s platform facilitated nearly 200 transactions for a wide range of clients, from individual farms to corporations, totaling nearly $11 million in notional weather risk.

At the same time, Arbol can also be used by scientists, scholars, government agencies and smaller weather data collectors. By allowing this set of standardized platforms to be used from various sources, open source tools that can process weather data will be available to a broader ecological market, making the IPFS ecological application market more prosperous and broader.

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