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The rise of both cryptocurrencies and CBD is a compelling narrative of two distinct industries finding their footing and exploding in popularity around the same time.
Bitcoin in 2009
The advent of cryptocurrencies dates back to 2009 with the introduction of Bitcoin, the brainchild of the pseudonymous inventor Satoshi Nakamoto. Initially, cryptocurrencies were largely the domain of tech enthusiasts and libertarians.
However, the last decade, particularly around the mid-2010s, saw a remarkable surge in popularity. Various factors contributed to this increase, including growing public interest, media coverage, and the development of more user-friendly platforms for buying, selling, and storing cryptocurrency.
Cannabidiol During the Mid-2010s
In parallel, CBD - cannabidiol, a non-psychoactive compound found in cannabis - also began gaining significant attention during the mid-2010s. The 2018 Farm Bill, which legalized industrial hemp production in the United States, was a key turning point.
This legislation effectively catapulted CBD into the mainstream, opening up a wide range of possibilities for its use in consumer products ranging from health supplements to cosmetics. From highly reputable sellers to third party ones with no label.
The Parallel?
The parallel trajectories of CBD and cryptocurrencies are a fascinating example of how societal attitudes, legislation, and technological advancements can converge to create significant shifts in consumer behavior and business opportunities.
Today, cryptocurrencies and CBD are at the forefront of discussions around financial technology and health and wellness, respectively.
Interestingly, their paths have now begun to cross, with cryptocurrencies presenting potential solutions to some of the unique challenges faced by the CBD and broader cannabis industry, particularly around the issue of payments.
As both sectors continue to evolve, the convergence of these two trailblazing trends is a space to watch closely.
The Potential of the Intersection of the Two
Understanding the potential intersection of cryptocurrencies and CBD requires us to navigate the uncharted waters of two evolving landscapes. Each stands as a groundbreaker in their respective fields, and together, they could transform the future of payments in the cannabis industry.
Traditional Payments before the “Getaway”
Traditionally, the cannabis industry, including CBD businesses, has wrestled with financial institutions' reluctance to handle their money due to regulatory complexities.
Even with cannabis gaining legal status in various parts of the world, many banks remain hesitant due to overarching federal restrictions. This is where the allure of cryptocurrencies comes into play.
Much Needed Decentralization
Cryptocurrencies such as Bitcoin and Ethereum, among others, operate on decentralized networks. They offer a solution to the banking challenge by sidestepping the need for traditional financial institutions entirely. For businesses dealing in CBD products, this approach presents a compelling opportunity to bypass the hurdles of conventional banking.
But it's not just the businesses that stand to benefit. For consumers, the use of cryptocurrencies to purchase CBD products brings a new level of convenience and privacy. The simple act of scanning a QR code and confirming the transaction is all it takes to complete a purchase, reducing the hassle and increasing discretion.
The Global View
On a global scale, the reach of cryptocurrencies transcends borders, making it an apt fit for the cannabis industry, which continues to expand worldwide. It means that customers, irrespective of their geographical location, could access CBD products and services using a universal mode of transaction, fostering an inclusive, global cannabis community.
An intriguing prospect to consider is the potential integration of cryptocurrencies within customer loyalty programs in the cannabis industry. The introduction of a system where customers could earn, for instance, CBD tokens as rewards for their purchases, could create an engaging and interactive consumer experience.
The integration of cryptocurrencies into the CBD landscape signifies a promising convergence. The potential benefits for both businesses and consumers make it a compelling prospect, promising to usher in a new era of convenience, inclusivity, and innovation in the cannabis industry's payment system.
It's a blend of two revolutionary trends, which could play a critical role in shaping the future of the cannabis industry.
Real World Crypto/CBD Solutions
In the dynamic landscape of the cannabis industry, numerous players are leveraging the versatility of cryptocurrencies for transactional efficiency. Let's take a glance at some real-world instances where crypto payments are (or were) making waves in this burgeoning sector.
PotCoin:
PotCoin is a digital currency that was specifically developed for the cannabis industry. It's a peer-to-peer cryptocurrency which aims to provide the cannabis industry with a secure, decentralized and efficient method of executing transactions. PotCoin is already being used in some dispensaries and cannabis-related businesses in regions where the plant is legal.
Bitcoin Payments:
Several cannabis businesses have started to accept Bitcoin due to its widespread use and acceptance. For instance, some online CBD product retailers offer Bitcoin as a payment method, as it provides a secure and private transaction method for their customers.
Ethereum and Alt Thirty Six:
In 2018, blockchain payment provider Alt Thirty Six announced a partnership with cannabis wholesale platform CannTrade. Their aim was to use Ethereum blockchain technology to facilitate B2B payments in the cannabis industry. This marked one of the first efforts to integrate cryptocurrency into the cannabis supply chain on a large scale.
Paragon Coin:
Although faced with legal challenges, Paragon Coin is another example of a cryptocurrency specifically developed for the cannabis industry. Its aim was to use blockchain technology to add transparency to the cannabis supply chain, though the focus has shifted more towards creating a co-working space for cannabis startups. And it has gone bankrupt.
Tokes Platform:
The Tokes Platform was designed to provide solutions to the cannabis industry using blockchain technology. Their cryptocurrency, Tokes (TKS), is aimed at providing a digital payment solution for cannabis businesses, in addition to implementing supply chain visibility tools.
Takeaway
While these real-world examples demonstrate the potential for using cryptocurrencies in the cannabis industry, there are also challenges associated with their use.
These include the volatile nature of cryptocurrencies, regulatory issues, and the need for businesses and consumers to understand how to use and secure their digital assets.
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.