The Cannabis Business Needs Blockchain
The Cannabis Business Needs Blockchain
First things first, blockchain is not just a reference to Bitcoin. The essential function of blockchain is to be able to trace a process of any kind, whether it be cryptocurrency or manufacturing and production and anything in-between.
Blockchain technology is a network of servers that interact with each other. The information is shared amongst all of the servers and is accessible and transparent to all contributing parties.
The cannabis industry has the opportunity to design itself internal and externally in a manner that can benefit the most from the advantages of blockchain technology. From the procurement of the raw materials to the purchase by the end consumer, blockchain technology facilitates the sharing and tracking at every touchpoint to ultimately create a cybernated record of every single movement and moderation occurring in a process. As simply put as possible, blockchain technology, is a digital ledger system that is decentralized, fundamentally transparent, and highly patrolled. The emerging and exploding cannabis industry necessitates the disruption of blockchain technology integrated into its operational and financial strategies.
Within the cannabis industry, regulations will dictate much of the movement in the industry.
Blockchain technology is more resistant to third party obstructions because, at its core, it is forthright. In most scenarios that involve a new, widely accepted technology taking an industry by storm, one of the most significant bottlenecks to expansion and total societal integration is government interference. This makes sense because, though new technology presents new opportunity, it also presents new potential threats to society. Technology changes rapidly so regulations must adapt rapidly too. Because of this, new regulation can be slapped onto a technology at any point.
Blockchain can add fluidity to future changes in processes because of the process visibility throughout.
Every step in the process is outlined in tremendous detail. This strengthens the operations within a company. Further regulation is to come. Blockchain helps.
Whether the regulations are from the federal ,state, or local jurisdiction, Blockchain can reduce the chances of missteps. From the seed at lab to distribution to purchase, blockchain will allow the cannabis industry to monitor environments at a granular level. Temperature, humidity, light, and many more factors will be monitored and maintained. This ensures production consistency. Consistency at all levels of the process in the cannabis industry is a nonnegotiable for any company aiming to have longevity.
Blockchain technology provides an organization with the ability to track and access the history of an item.
Everyone has a ledger of the entire process. Every communication and action is not only tracked but transparent. That information is accessible to every vendor/contributor to the process. The contributors are not outright named in many situations but the company or contributor is still fully tracked via their code so, though there is some anonymity involved for privacy and safety reasons, the transparent nature of blockchain facilitates process authentication.
The cannabis industry is so new that reputations and trust can be hard to give without warrant. Now because so many people have access to the big and total picture, companies have the ability to authenticate their claims. A company in this industry can authenticate their supply chain, verify claims of sustainability, verify claims of organic, and verify claims of “all natural.” Cannabis companies can verify exactly how a product has been created, maintained and shipped throughout the process from the lab to the field to the consumer.
When constant changes are being made, blockchain technology integrated into the process can act to fortify and protect the innovation, IP, production advantages, etc.
This also creates a form of self-monitoring within the process. Each party’s innovations and contributions cannot be attributed to a wrong party so there is protection and accountability. Claims of dosage and potency can be confirmed because of time stamping, location identification, date verifications , and many more classifications that can be linked to a product. This allows for information auditing to be easier.
Auditing financials is expedited with a systemic integration of blockchain technology as well. The technology itself should not be thought of in a manner that is limited to cryptocurrency. Once again, blockchain is not just for Bitcoin. Previously, blockchain was almost synonymous with cryptocurrency; however, the fintech route is lucrative and ready for innovation and opportunity. Financial data that is held in any one place can be easily corrupted or hacked. Spreading the information across many channels that is accessible from multiple entities creates security. A hack or irregularity is likely to be detected and pinpointed faster. Additionally, a potential attack or weakness can be stopped and fixed sooner.
Blockchain technology decentralizes information and entities which ultimately, could make bank accounts obsolete. Eliminating the need for bank accounts with cut out the transactional middle man, thus allowing for another major opportunity within the cannabis industry – direct to consumer procurement. Goods and services could be purchased directly from the creator by the consumer. This is cost effective because there is no exchange fee associated with the involvement and dependence of a 3rd party and mitigates the risk associated with any product or currency switching hands. The data is almost tamper-proof because the data is cryptographically stored in so many accessible places.
All of these areas of operations and finance benefit from blockchain technology; however, from a talent attraction perspective, the integration of this technology can serve as a bottleneck if companies do not prepare preliminarily.
As companies attract talent now, they should keep in mind the types of candidates that will be able to pivot and facilitate this integration when the time arises. Nobody has 25 year of experience in blockchain so companies will have to factor in potential and patterns in order to decide if your team is prepped for this, likely inevitable, shift. If these companies are faced with restructuring and “figuring it out” when it’s crunch time, the benefits are already lessened. Essentially, companies should consider laying a foundation now that will support future change and expedite the evolution later with fluidity.
Blockchain is a disruptor to the current supply chain and value chain in Cannabusiness. When integrated into Cannabusiness from the conception of its infrastructure to the establishment and solidification of its business practices within the industry, it is critical and disruptive. Disruption, at its core angers those who benefit from the bottlenecks and inefficiencies of the status quo. What would I suggest? I say LET’S PISS SOME PEOPLE OFF. Disruption can cause efficiency. Disruption can create a space for new thought. Disruption can lay a foundation for new businesses. Old businesses will have to adapt, learn, and grow. That, my friends, is progress.