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Over the past year, Blockchain has evolved from an ambiguous concept to one of the most talked about technologies among virtually every industry. It is a little understood but much-discussed concept that appeals to many people in different ways. While code crackers use it where they don’t consider anything safe or trustworthy, business tycoons utilize it to grab some forward-thinking tech hype. The broad horizon of Blockchain has covered various business niches, and the Cannabis industry is no exception.
In this modern era, it won’t be wrong saying that Blockchain is transforming the markets from left to right and that’s why those immersed in the Cannabis industry are leaving no stone unturned to adopt this vast technology. It has evolved as a ubiquitous technology that is laying the foundation stone for creating a system to revolutionize the Cannabis industry. Nowadays, it’s necessary to monitor end-to-end Cannabis supply chain to ensure that none of the products get unnoticed. This is where Blockchain steps out from the shadow and steals the show.
In this blog post, we will be focusing on how Blockchain will disrupt the Cannabis industry and how it can bring more control and parity in it. So, without further ado, let’s get started!
1. The trust factor: The parties involved in the Cannabis supply chain don’t entirely trust each other and need the third party as a trusted factor. Hence, Blockchain allows safe and secure record keeping without needing a trusted intermediary. It reduces the supply chain costs and speeds up the transactions as well as moving of Cannabis products from one place to another.
2. Cannabis transactions: In foreign countries, financial institutions are forbidden from facilitating transactions in the industry as Cannabis remains illegal on the federal level. So, dispensaries are not able to accept debit or credit cards and handle hundreds or thousands of dollars in cash, which leads to taxation hurdles and inaccurate financial statements. That’s why many financial institutions use Blockchain technology for easier audits and transaction validation during Cannabis transactions.
3. Cannabis tracking: The usage of Blockchain in the Cannabis industry enables the real-time oversight of the entire Cannabis supply chain by capturing the complete transaction history. It also provides a more transparent and reliable way of tracking pot distribution and production. As per the IBM’s report published last year, Blockchain technology would turn out to be the ideal mechanism in the coming future for capturing the Cannabis history in the supply chain while exerting regulatory control from seed to sale.
4. Cannabis Looping and Smurfing elimination: Looping in the Cannabis sales is a practice of returning to the same shop in order to buy Cannabis two or more times in a day while Smurfing involves visiting different shops to make multiple purchases on the same day. Leveraging a Blockchain based system for people reporting within a given market eliminates Cannabis looping and smurfing schemes. It restricts the customer’s daily limit of buying Cannabis by tracking each part of his journey at each shop. Utilizing Blockchain to document transactions reduces the possibility of cheating the system.
5. Taxation facilitation: No matter how much quantity of Cannabis you buy or from where you buy it, it’s necessary to pay a hefty tax, which is the major part of the legalization pitch. In foreign countries like Colorado, Massachusetts, and Nevada, those who buy marijuana face an additional sales tax of approximately 10 to 15 percent. Making Blockchain Ledger technology mandatory for dispensaries could reduce the sales tax and make sales figure immutable & certain.
6. Quality assurance and maintenance: By utilizing Blockchain in the Cannabis supply chain, Cannabis businesses can provide a complete picture of supply chain process to their customers, starting from when it was just a seed and how many parties it touched. It can give an assurance to the customers that they are receiving high-quality Cannabis products.
Is Blockchain the future of the Cannabis industry?
While 2018 was the year of cybersecurity, it looks like 2019 is shaping up to be the year of Cannabis. According to the recent report by the Brightfield group, a research firm focused on Cannabis, the market of legal Cannabis is projected to hit $31.4 billion by 2021. Cannabis is a big business today which is inching towards legalization in many countries. That’s why entrepreneurs are eager to bring technologies like Blockchain to the weed industry.
With the Cannabis industry growing by leaps and bounds as more and more countries are making it legal, it is more important than ever to decipher how to regulate a product that is infamously secretive. The answer to all such similar questions is Blockchain. If counterfeit Cannabis is a crucial problem, Blockchain is most likely an optimum solution. With both Blockchain and Cannabis industries taking off this year, it will be interesting to see how the two will interact with each other in the coming future.
If you’re looking for someone who could build robust, feature-rich Blockchain applications for your business, then contact us. We offer expert Blockchain consulting services to diverse business verticals and help them reap the maximum benefits of the Blockchain technology at the most optimal prices. For deeper insights on our Blockchain expertise, visit us or give us a call at +1-703-537-5009