Bitcoin and the blockchain concept has natural, direct benefits for the public/retail investment community. Prior to the blockchain, the average Joe was limited to either a standard 401k retirement plan, or a personal brokerage account such as E*Trade. Both avenues play by Wall Street rules: defined schedules, exorbitant fees, and a “good ol’ boys” culture.
With the advent of the blockchain, these arbitrary rules are turned onto their heads. Taking the third-party intermediary out of financial transactions and market operations, Bitcoin and cryptocurrencies can exchange value significantly cheaper than traditional methodologies. Furthermore, this decentralized platform opens up the door to all interested participants, irrespective of color, creed, or borders.
But the blockchain will truly come into its own when it impacts seemingly non-related industries. Marijuana and the broader cannabis industry, is as old and “irrelevant” to the blockchain as it gets. For thousands of years, people have enjoyed “herbal solutions,” to varying degrees of social and legal acceptability.
However, it was only until recently that the cannabis industry opened the pathway to a sector revolution. Primarily, the legalization movement gained significant momentum, recently culminating in ballot victories last year. The movement also inspired associated innovations, such as herbal vaporizers that prevent marijuana flavors from combusting (which results in dangerous residuals).
The biggest impact to the cannabis industry, though, is just around the corner. Utilizing the same technologies of the most popular blockchain platforms, IBM proposed using the decentralized network for properly managing marijuana sales.
Next year, sales from Canada’s cannabis industry will be fully legal. Although a tremendous victory for the broader movement, it raised a tricky question: how will this new sector be regulated? Largely considered a narcotic, marijuana sourcing – ie. making sure marijuana inventory doesn’t come from the black market or the illegal drug trade – is absolutely critical to establishing credibility.
IBM forwarded the idea of using the blockchain to track the entire supply chain of the cannabis industry, and the proposal is a natural segue. For instance, the Bitcoin blockchain was the first to solve the “double spend” problem – how to create a digital token that is impervious to duplication. Now, IBM has the chance to take the technology a step further.
Consider the problems of marijuana dispensaries. Although their business has been recently legalized, they must make doubly sure that their inventory is properly vetted, controlled, and distributed. Ordinarily, the verification for these data points would be conducted by human operators. With the blockchain, the vast majority of that verification can be confirmed through artificial intelligence.
As an immutable platform, the blockchain presents a pitch-perfect solution to the burgeoning cannabis industry. The last roadblock to full marijuana legalization, questions about proper execution of the marijuana business, is finally answered through this emerging technology.