Cryptocurrency and cannabis are two of the most exciting emerging industries of modern times. Both are constant topics of discussion in the media and in politics at national, state and local levels. We have covered several aspects of the cannabis industry and the crypt run, but most are honestly little more than the kitsch value.
Hempcoin is one of the few feasible cannabis crypto projects that have gone through our radar so far. Many, like Alt Thirty Six, focus on cryptographic payments in cannabis. Since this is an industry predominantly in cash (many dispensaries and delivery services across the country have come up with ways to accept card payments), cannabis seems ripe for breaking the cryptocurrency.
The blockchain is the true value of cannabis, though. Supply chains are desperate for blockchain technology, and it is no longer evident in the legal medical and recreational cannabis industry. The seed-to-salt tracking is mandatory, and each state has different requirements and a different registration system.
Cryptographic payments are of little interest for cookware dispensaries as well as for service stations, grocery stores and real estate agents for the most part. But the cannabis supply chain can be easily interrupted by the right blockchain if they play their cards the right way.
Why Crypto is not on top of Pot's mind
The strength of a cryptographic currency like Potcoin is that cannabis-based businesses can not use banking services. This is somewhat true: the institutions insured by the FDIC can not do business with the cannabis industries until they are federal, reprogrammed and decriminalized.
However, the Treasury Department has left things open to banks to open up accounts and businesses based on cannabis have long found ways to deal with excess cash problems. Funding and payments simply are not attractive to retailers at the moment – cannabis distributors are no different.
These companies are highly controlled by federal, state and local authorities and regulators, and the last thing they have to do is wager their money. Moreover, only these days are able to start only well-funded projects.
In the recently legalized California recreational market, it costs about $ 500,000 only for licensing fees and start-up costs. These become annual fees, and this does not even include taxes and typical overhead and work expenses. It is a huge obstacle that serves as a financial guardian for all, but companies with liquidity to play.
And it's a gamble: California has grossed over $ 2.75 billion in cannabis sales to date, but businesses are likely to be shut down or raided after Jeff Sessions ordered the Justice Department to ignore Was Obama's – who had essentially ceased federal harassment on the marijuana industry, except in cases of interstate commerce, organized crime and sale to minors.
Doing business with the crypto industry is heavily scrutinized by the regulators themselves, it seems like adding fuel to the fire. High Times has even canceled an effort to use Bitcoin in its IPO: one can only speculate about how new voickers like Marijuana Business Daily, Dope and Cannabis Now will see the High Times decision to avoid the crypts route.
The Cannabis Supply Blockchain Saves the Day
The real sore point that the blockchain can solve for the cannabis industry is in the seed-to-salt monitoring. What is currently happening in every state that legalizes medical and recreational cannabis is that a stock tracking system becomes the official state registration system. In many states such as California, Nevada, Alaska, Oregon and Colorado, Franwell's MetRC is the preferred SoR.
California faces huge delays at least until November in its comprehensive tracking system because the implementation of MetRC is more difficult than it appears. Every single product must be labeled as seeds, plants, harvest, extract, etc. The patient is also traced.
If you've never seen a legal cannabis label, here's one of Arizona's medical marijuana program. It's for a Thai stick.
Everything is scanned and traced so that the state can see the complete travel of each product from being planted to purchase it from the end user. In the do-it-yourself states like Oregon, seeing the whole life cycle from farm to table of each ingredient in all is coveted. If you do not do it well, they will grow and be alone.
In Nevada, the tests are among the best in the country. This means that every batch of each grower, producer and dispensary must be tested for heavy metals, pesticides, molds and other contaminants, in addition to the power levels. Labeling and testing requirements become rigid and the transfer of data from the dispensary's internal point-of-sale system to the SoR of the state has many moving parts.
This is where the blockchain could easily solve the cannabis industry. By attaching the codes and labels already tracked, the information is easier to store, archive and search. Compliance and data transfer between licensed companies and government agencies would be significantly improved.
But, as for the whole government, there is a warning
The only problem in the path of the adoption of the marijuana blockchain
Apart from the fact that nobody except Hempcoin is really focused on the use of blockchain for the cannabis supply chain, the other problem is that every state has existing contracts with a particular service provider.
To implement this business to help the cannabis industry, it would be necessary to have a finger on the pulse of when federal lawmakers are willing to decriminalize it. At this point, you could launch the blockchain at the federal level against all companies like Franwell that make legacy systems.
Instead of advertising stunts such as sending Dennis Rodman to North Korea or throwing a pot-china on a crypto, it's where the real money needs to be made in the cannabis industry.
Every cannabis entrepreneur is at the height of their abilities in businesses looking to take a piece of their cake. You will not win them unless you can legitimately solve their problems … even if you have to go beyond their heads to do so.
Currently the author is not invested in any cryptocurrency mentioned here. He, however, contributed to the High Times magazine and brings a medical marijuana card in the state of Arizona.