Is Crypto Pot’s Banking and Supply Solution?
Young and suppositional markets are mostly ridden with presumable investment opportunities, and no, crypto isn’t any different. With a proliferation of meme-tier currencies and shitcoins, there are more meaningless than inestimable projects to select from.
Indeed, there are 1,400+ coins and more entrance out by the day. It seems like entrepreneurs around the universe are slapping “blockchain,” “crypto,” and “decentralized” onto ICO projects, heralding a use box for their attention as they float a call of increase on a sea of opportunity.
Some industries have a transparent need and use for blockchain, but for those that don’t, the voice of healthy doubt in the back of our minds mostly questions: “Do we really need blockchain for that?”
If you had this greeting when entrance opposite PotCoin, HempCoin, and the like, you’re probably not alone. But there’s indeed a clever box to be made that North America’s budding pot industry, generally in the United States, is in apocalyptic need of standards, transparency, peculiarity maintenance, and remuneration solutions, and wouldn’t you know, blockchain offers the cure-all to many of pot’s problems
The Case for Pot on the Blockchain
The two seem to element each other nicely, don’t they? Both rising industries, both appealing to millennials, both technically authorised but still rough and stigmatized enough that you might not divulge your seductiveness in them at family gatherings.
Pot and crypto have really been prohibited on the tongue of cocktail enlightenment recently, and what’s more, they’re starting to be used in the same sentence. With good reason, too; cryptocurrencies and blockchain record have the intensity to solve two problems plaguing the tot industry: remuneration deterrent and supply tracking.
All but 4 states in the US have ratified pot in some form, possibly this be recreationally, medicinally, or for low THC medicinal products. And yet, dispensaries are unequipped to accommodate debit/credit cards or checks, generally those that understanding only in recreational cannabis.
Reason being, banks exclude to open up accounts with pot businesses, so many have to run on a cash-only business model. Seeing as pot is still pegged as a report 1 analgesic underneath sovereign US law (the same report as cocaine, meth, and heroin), most banks are heedful to accommodate dispensaries and growers.
In fact, only 300 out of 11,000 US banks are peaceful to offer their services to the pot industry. But even if a cannabis businessman gets a bank on board, remuneration processors such as PayPal, Stripe, or Square might exclude to do business with them for fear of income laundering charges or sovereign backlash.
You probably see where this is headed. In the area of banking for the unbanked, blockchain could yield a permissionless banking resolution for the pot attention with cryptocurrencies as the source of collateral and liquidation. Cryptocurrencies could offer as the cashless purchasing surrogate pot shops now don’t have. Using possibly the banking directly or purchasing it with crypto ATMs within the dispensaries themselves, business can suffer an choice remuneration routine that won’t leave shopkeepers fist-full with Lincolns, Jacksons, and Benjamins.
For Supply Chain
Payments aside, blockchain record itself could also oil the whole pot supply chain. Moreover, it could deliver an combined covering of clarity that would leave every step of the routine more agreeable with state regulations and sovereign tolerance.
After Washington and Colorado ratified recreational pot in 2012, the US Department of Justice expelled a memorandum entitled “Guidance Regarding Marijuana Enforcement,” aka the Cole Memo. The memo radically reads that the sovereign supervision will endure state-regulated pot industries so long as they approve with 8 guidelines. One of these discipline prevents cross-state sales of authorised pot to states where it’s still illegal.
If growers, shippers, and sellers were connected through a blockchain network, the risk of bootleg sales could be most neutralized. Orders, shipments, and products could be entered into and traced on the blockchain, withdrawal no doubt as to how much product a hospital has purchased and how much it has in stock. There are apparent supply sequence supervision advantages here. But from a regulatory standpoint, if a supervision wanted to review a store’s register and offering story for any abnormalities, a discerning indicate through a distributed ledger’s database could transparent the air–unless a store is indeed enchanting in bootleg sales, that is.
With this system, the whole ecosystem’s dissemination could be tracked and verified. This clarity would advantage attention professionals and governments alike, as it would make it that much easier to make sure that growers, dispensers, and shippers are handling within their authorised limits.
The Cryptocurrencies Providing Solutions
The few and the proud, there are a handful of projects in the blockchain area looking for a fix. The infancy of these cryptos are privately coins, with no other duty than to concede people to buy some immature but greenbacks.
The two most popular, PotCoin and HempCoin, are indeed some of the oldest coins on the marketplace (both were combined in 2014). Newcomer Budbo, whose token placement went underway as this was written, looks towards being both a silver and supply tracking height for consumers, producers, and sellers all.
“PotCoin is the first digital banking combined to promote exchange within the ratified cannabis industry,” the coin’s website proudly proclaims. Touted as “a village formed effort,” the silver operates using Proof of Stake and claims to yield instant, low-fee transactions.
As it now stands, PotCoin is used essentially for the cannabis purchasing power. According to a blog post from Oct 2017, PotCoin is accommodated by or treacherous at roughly 800 locations in 35 countries interjection to General Bytes, one of the world’s heading Bitcoin ATM providers.
In further to the unique inlet as a currency, PotCoin allows the holders to interest their POT in a seed bank. As per common banking staking, the seed bank awards users tangible pot plant seeds proportional to the number of POT coins they have staked. So long as you live in a plcae where flourishing pot is legal, you can “withdraw” your seeds and have them shipped to you at any point. This way, if you have POT staked in a PoS wallet and the seed bank, you can watch your investment grow, both literally and figuratively.
In the future, the group hopes to quit PotCoin to the Ethereum or the Bitcoin blockchain to settle the PotCoin Decentralized Autonomous Organization. Using possibly Ethereum or Counterparty, the group wants to exercise a governance structure for the silver finish with intelligent contracts. As more merchants start to accept PotCoin, they predict a rewards module for sellers and consumers, as well.
Similar market, different approach, HempCoin is operative towards the same idea as PotCoin, though the routine and gait of adoption set it apart. The silver has been around for about as long as PotCoin, but it’s not supposed scarcely as much around the universe or in North America.
Currently, it’s undergoing a estimable rebranding. For the first two buliding of 2018, the group has a hardfork designed to pierce the banking to a masternode accord model à la Dash. Like the silver that pioneered this model, HempCoin will use a hybrid Proof of Stake/Proof of Work indication that will accommodate present send and unknown exchange along with network governance.
In addition, the HempCoin group is operative on a accumulation of remuneration vectors to assistance their product crossover from fanciful to tangible use. These embody “HempPAY™ Mobile, HempPAY™ Card and HempPAY™Online.” As with PotCoin, HempCoin skeleton to hurl out an incentives module to inspire both dispensaries and consumers to adopt their remuneration method.
Budbo wants to be the all-in-one blockchain resolution for the pot industry. Beyond the stipulations of an choice currency, Budbo looks to bond growers, dispensers, and business through the blockchain, the blockchain itself providing an industry-tailored apparatus to conduct all stairs of pot production.
With Budbo, all aspects of a product’s lifecycle could be available and traced on the blockchain. This means that growers and labs can endorse THC/CBD calm and other specifications, sellers can put tabs on inventory, and consumers can lane their squeeze back to the very seed it came from.
This turn of peculiarity control provides attention professionals and governments comparison with a resources of logistics, including explanation of orders, explanation of pickup, and explanation of delivery. Moreover, growers and dispensers will be means to use Budbo to place orders for reserve and products. For example, growers can use their focus to buy more seeds or harvesting tools, and sellers can fill in their register gaps by fixation orders with growers or producers.
The Budbo focus is looking to favour a amicable and business landscape for the immature industry. Its initial version, Budbo v1.0, already provides a use for users to find products that best fit their tastes. The “Tinder-like” focus allows users to appropriate through a array of dispensaries and product offerings that compare their particular likings, all with the wish of weeding out what they don’t want for what they do. This is just a singular example of the intensity to bond cannabis users from all walks of the attention into a single, comprehensive focus that will (hopefully) raise and facilitate everyone’s user experience.
Stepping divided from pot-specific cryptocurrencies, there are a integrate of other developments in the space attempting to solve marijuana’s income problem.
In Oct of last year, Dash partnered with Alt Thirty Six, a point of sale remuneration platform, to be the solitary cryptocurrency offering by the system for cannabis-related transactions. Alt Thirty Six chose Dash for the Private Send and Instant Send functions.
We quickly mentioned ATM provider General Bytes in our contention on PotCoin. Additionally, POSaBIT and SinglePoint Inc. use crypto ATMs to offer as an surrogate for cannabis transactions. Basically, consumers use an in-store ATM to squeeze cryptocurrency with their debit/credit cards, and they can redeem this banking at the opposite for any of the dispensary’s available products.
While startups and crypto projects rise operative solutions, some dissenting voices are unconvinced that such a budding and capricious attention as crypto can assistance another like it. The pot industry, they argue, will never want to adopt such a flighty remuneration method, especially because banks will expected start to accept pot merchants more straightforwardly as legalization continues to ink the way into state and sovereign legislation.
Most of these arguments, however, destroy to cause in the blockchain’s supply sequence and logistics benefits. Maybe crypto will grow too solemnly to kick banks to the financial punch, but that still leaves the blockchain’s distributed bill and decentralized structure to yield security, transparency, and trustworthiness to an attention still training to walk. Perhaps crypto will be there to reason the palm along the way, as the entrance years will no doubt clarify what purpose (if any) it will play in authorised marijuana’s expansion in North America and elsewhere.