At Gas-Dank, we firmly believe in crypto and its potential to change the cannabis industry as a whole. In this article, we’ll be discussing everything crypto; from its importance in the cannabis realm to the different types of cryptocurrencies, you can use at our online store.
Cryptocurrenciesalter the way we interact with money. Here at Gas-Dank, we’re massive fans of crypto and hope to do our part in helping cryptocurrencies like Bitcoin become mainstream payment methods.
Cryptocurrencies are still a developing and contentious topic in the business world, but their potential implications for the cannabis industry make them worth exploration. In this article, we outline our reasons for supporting cryptocurrencies as well as some of their current challenges. Additionally, we describe which crypto coins we’re currently accepting at our store (Bitcoin and BitCanna).
What Are Cryptocurrencies?
It’s crucial to understand the contrast between cryptocurrency, blockchain, and Bitcoin—even though these terms are used interchangeably quite often. To avoid getting too technical, we’d simply like to make the following distinction:
- Blockchain is a decentralized, encrypted technology that enables the existence of cryptocurrencies and tokens. However, advances in blockchain technology show that its uses may extend far beyond simply handling monetary transactions.
- Cryptocurrency is a digital asset that employs cryptography to secure its transactions and to control the creation of new units. Cryptocurrencies are decentralized, meaning they are not subject to government or financial institution control.
- Bitcoin, the first cryptocurrency ever created, is the best-known example of its kind.
In order to make cryptocurrencies more accessible to our customers, we are incorporating them into the payment options that we offer. However, we understand that these currencies can be confusing and difficult to wrap your head around. So, in an effort to help out, below is a description of how they work and why they matter.
Blockchain is the technology that cryptocurrencies like Bitcoin are built on. To understand it without getting overwhelmed by all the technical jargon, think of blockchain as an accounting ledger. It records transactions on a system made up of multiple computers, which anyone can access. The network of computers constantly updates and verifies the information in this ledger.
The key feature of a blockchain is that it’s append-only, which means that the ledgers on each computer can only record new information rather than editing existing data. To ensure the security of this logged data, blockchain technology uses cryptography to protect all transactions. The end result is a public accounting system that isn’t owned by any single entity and utilizes peer-to-peer networking.
Bitcoin and other cryptocurrencies use blockchain technology to create coins with a monetary value and track trades made with those coins.
Benefits of Cryptocurrency
Below are some of the advantages that Bitcoin and other similar currencies have over more traditional stores of value:
- The value of cryptocurrencies can change dramatically because they aren’t regulated by a centralized organization.
- Cryptocurrencies can’t be reproduced, meaning (in theory) that they’re a great safeguard against inflation.
- Cryptocurrency transactions occur when two people trade directly with each other, without going through a third party like a bank or broker. Therefore, there are no fees associated with these types of transactions.
- One of the great advantages to using cryptocurrency is that your transactions are confidential. With a credit card, when you make a purchase, not only does the merchant get access to your entire credit line but other entities like governments can track and see what you have purchased. Crypto transactions solved this problem by being recorded on an encrypted ledger that can only be added to—not edited or deleted. This means that the only person who will know about the transaction is you and the person you’re trading with.
- Cryptocurrencies are easy to get into. All you need is an internet connection to create a crypto wallet, buy some cryptocurrency, and start trading.
- Because cryptocurrencies aren’t subject to third-party approval, transactions using this method are completed much faster than with other methods (such as wire transfers).
Why Are Cryptocurrencies So Important to the Cannabis Space?
We believe in crypto because it provides a much-needed solution for cannabis companies operating in the current financial landscape. Despite the industry’s growth and worth, prejudice from banks, credit card companies, and other financial providers continues to prevent many legitimate businesses from getting access to essential services. With crypto, we can level the playing field and provide much-needed support to an underserved market.
In the United States, legal cannabis companies are forced to operate with cash only. Cannabis is considered a Schedule 1 controlled substance under federal law, so banks fear they will be prosecuted for money laundering if they handle money from these types of businesses.
It’s clear that making a billion-dollar industry stay unbanked creates security issues. For instance, dispensaries and other legal cannabis companies in the US have been robbed before, and these robberies were often planned out well in advance.
Our company is based in Europe and we still face the challenge of being viewed as illegitimate by some payment providers. Unfortunately, this prejudice makes it difficult for us to process payments from platforms like PayPal or Payoneer. For example, credit card companies often reject payments made to cannabis companies that are operating completely legally. This not only wastes our time but also limits our ability to reach a wider customer base.
Cryptocurrencies present a world of opportunity for cannabis companies that are restricted by numerous unideal forces. Not only does it give them the ability to securely manage non-cash payments, but crypto also allows these companies to reduce banking or service fees. Most essentially, cryptocurrencies enable cannabis companies to operate without being constantly watched over by regulatory third parties. In other words, gas-dank and others like it can enjoy the same freedoms as any other upstanding business would.
Cryptocurrencies have the potential to revolutionize the cannabis industry by freeing it from traditional financial constraints, such as high fees and slow transaction speeds. In addition, cryptocurrencies could also help reduce prejudice against the industry by operating outside of the traditional financial system.
What Challenges Do Cryptocurrencies Still Face?
Cryptocurrencies have a lot of potential, but we must be honest about their limitations as well.
One of the critical issues cryptocurrencies face is their unreliability. Cryptocurrencies are only worth something when their number of users grows, and thus far, only a few coins have managed to get and keep a solid user base. Even Bitcoin, the most valuable cryptocurrency has had immense changes in its value over time. Without a dependable group of users to raise and stabilize their value, cryptocurrencies can’t provide a real answer to cannabis industry’s banking issue.
Cannabis-specific cryptocurrencies are having an especially difficult time because of their limited scope. Companies are hesitant to adopt a cryptocurrency that is only used in one industry, which further decreases its value and market capitalization. In order for a coin to be adopted by publicly traded companies, it needs widespread use, something that many cannabis-specific cryptos don’t have.
When compared to Bitcoin or ETH, few “altcoins” provide companies with a sound justification for using them over more established cryptocurrencies. These companies could be subject to substantial value fluctuations that would endanger the profitability of their business by adopting altcoins.
Although there are very few cannabis-specific cryptos that offer a practical solution to the industry’s problems right now, that doesn’t mean blockchain has no place in cannabis. You’ll see below that blockchain technology could promoting progress in the cannabis industry through other means than banking or managing payments.
Other Applications for Blockchain Technology in the Cannabis Space
Cryptocurrency is blockchain’s best-known use case, but the applications of this technology extend much further than just simplifying and decentralising payments. Blockchains create digital, encrypted, shared ledgers that can be used to securely store all kinds of data. This has numerous potential uses in different industries–cannabis being one example–that could have a huge impact on said industry.
Storing and Securing Clinical Data
Blockchain is demonstrating a lot of potential in the storage of sensitive data related to clinical trials, for example. In order to produce objective results, medical research relies on keeping accurate records; this means that clinical trials need to track patient data, the drugs or procedures being tested, and the entire trial process from start to finish.
In order to achieve reliable and accurate clinical results, researchers need to be able to track even the smallest changes or complications that occur during a trial. This gives them a clear overview of the entire trial, as well as any limitations. Blockchain technology allows researchers to securely store all this pertinent data and review it, while knowing that the data is protected by state-of-the-art cryptographic security measures.
Blockchain technology is slowly seeping its way into the medical field in order to help secure the transfer of sensitive data. One company, BurstIQ, located in Colorado, uses “smart contracts” which are digital contracts that rely on blockchain for real-time enforcement of rules. This same technology has great potential to be used in consultations between doctors and patients who are exploring cannabis-based therapies.
Another example is Patientory, a blockchain solution designed to manage the problem of fragmented medical information spread across multiple providers/clinics. The platform, developed in Georgia, helps bring all of a patient’s medical records together onto one secure ledger and communicate that to relevant entities (such as healthcare providers or clinicians) when necessary. Similar platforms could be developed to help streamline healthcare data in the medical cannabis space.
Supply Chain Improvements
Blockchain has the potential to change supply chains in many different industries, one of them being cannabis. Oftentimes, customers are worried about the quality control measures for products like flower or concentrates- however, with blockchain technology, this wouldn’t be an issue.
In the same way that it safely stores financial or medical information, blockchain could be used to keep a record of every step of the flower or concentrate production process – from seed to harvest. With this data, consumers and retailers would be able to track exactly what seeds were used, where the cannabis was grown, what fertilizers/pesticides were applied and when, etc.
A secure and transparent database for cannabis supply chains would help to legitimize the industry and ensure product quality.
Crypto Cannabis Coins of 2022
Both the crypto and legal cannabis industries have many aspects in common, from their operates primarily online to facing issues with regulation and finance. Their target markets even intersect at times because they are both popular among younger people.
Cannabis companies had a banner year in 2019, and experts believe the industry has huge potential for growth as more states legalize cannabis. Here are some of the most popular cannabis-related cryptocurrencies and their current value.
PotCoin is a cryptocurrency that was created specifically for the marijuana industry. Its primary objective was to resolve banking-related and other types of P2P transaction issues. PotCoin is well established, with around 420 million in circulation, and its market cap was around $80 million in January 2018. Each coin was worth nearly $0.40 at that time. Currently, PotCoins are worth $0.0109 each, but they are predicted to reach $0.60 by 2022.
DOPECoin was also launched in 2014 with a current market cap of $1.5 million and is priced at $0.00113. It functions similarly to privacy coins as all exchanges are quick, have no fees, and are anonymous. The system works on the proof-of-stake (POS) consensus algorithm where stakers receive an annual interest of 5%. DOPECoin can only be traded on Mercatox exchange
This currency, called “dead currency” because of its value, was created in March 2014. It uses P2P technology and is decentralized, running on a blockchain system. CCN had more potential than other cannabis coins because many dispensaries in California were already familiar with it when it came out. However, it did not gain much value and by 2018 end, Each coin was priced at $0.46 but by the end of that yearCannaCoin was only worth $0*.00003 and is no longer traded actively.
A few months after PotCoin’s release, CannabisCoin (CANN) followed in its footsteps as a proof-of-work (POW) P2P digital currency created to ease transactions between medical marijuana dispensaries. For particular strains of cannabis and marijuana, called CANNdy, 1 gram of the product can be exchanged for 1 CannabisCoin. Dispensaries are also able to accept CANN as full payment for medications at the current exchange rate. Additionally, candy holders can use their coins to buy licensed cannabis products from CBD oils and cosmetics to certain types of marijuana seeds.
CANN’s market capitalization is $22.8 million, with each coin valued at $0.011 and 106 million coins in circulation. The coin trades on the YoBit exchange currently.
HempCoin(THC) was created in 2014 to manage safe business among growers, sellers, and users of marijuana (dispensaries). THC’s purpose is more farming-based instead of targeting the general population. In January 2018, each coin cost $0.53 and the market cap was $122.8 million. By 2022 end, it was projected that THC would reach $11.44, however, its worth has diminished significantly to around $0.003 per coin because the Price dropped a few months ago. There are currently 253 million in circulation
January of 2017 saw the announcement of KushCoin by a team entrepreneurs spanning both Europe and North America. The project has ambitions to use blockchain technology in order to improve supply chains for medical cannabis logistics networks. In addition, it provides consumers with a decentralized banking solution that is fast, secure, and most importantly- cost free when it comes to transactions.
With a market cap of $150.51K and 5.63 million in circulation, its last known price was $0.027
Paragon (PRG) was introduced in July 2017 as a cannabis coin. It deploys blockchain-enabled products to organize business workflow, resolve critical issues of the cannabis industry, and stabilize the legal marijuana market.
Before its collapse, PRG was projected to be worth $4.07 by the end of 2022. Unfortunately, too much hype led to an overinflated value, and the coin is only worth $0.09 today. Its market cap stands at a woeful $608,000, with $22..8 million in circulation.
Growing up Hand-in-Hand
The cannabis and cryptocurrency industries are both relatively new and play well off of each other in the legal sphere. Cryptocurrencies offer accountability and transparency to cannabis businesses, while the latter provides a dependable customer base for the former. In general, both markets present a unique outlook of the future global economy.