One is the “old guard”, has been around the block too many times, the other, has tried and tried, but still has a lot of miles left on the clock. As much as it sounds like a slapstick movie, it is also the story of CBD and crypto. CBD, as we all know, is derived from the cannabis plant, which has been smoked, chewed, eaten, sown in rags, used for psychoactive and medicinal purposes, for thousands of years. Cryptography and blockchain technology, by comparison, are still in their infancy, and were merely a theory in 1982 when a cryptographer named David Chaum proposed the protocol in his thesis.
Cannabis has been a big part of nonconformism since the early 1970s, when Nixon-era politics were in full swing and anti-establishment sentiment was at its highest (no pun intended).
Despite their age difference, there are many similarities between the two; starting with the crash that hit the crypto market in 2018, then a year later, cannabis industry stocks plummeted. Both are disrupting major legacy industries that have traditionally been led by elitist, centralized monopolies, leading to a surge in new start-ups in the financial and healthcare sectors.
However, there is much more to the relationship between crypto and cannabis than just boom/bust market cycles. Cannabis has been a major part of the breach since the early 1970s, when Nixon-era politics were in full swing and anti-establishment sentiment was at an all-time high (no pun intended). Similarly (I’m not doing this on purpose, I swear), crypto has been the digital backbone of the financial sector since 2017, when adoption exploded, relatively speaking. Seen as the best opportunity to wrest power from trillion-dollar financial institutions, by allowing anyone to control their own finances and maintain financial privacy, cryptography has become the ultimate weapon against centralized control.
This not only hurts the consumer by making them pay more for an inferior product, but also the CBD industry in general, because it plants the (hemp) seeds of mistrust.
Right now, several CBD companies are going all out, leveraging blockchain technology and cryptocurrency, creating solutions to the biggest problems the industry faces because it operates in a legal gray area. These are specifically financial services and provenance of the multiple ingredients that go into CBD products. Due to the lack of regulation, some “shadier” operators are taking advantage and passing off poorly designed and manufactured CBD products as “high quality” and charging a premium. This not only hurts the consumer by making them pay more for an inferior product, but also the CBD industry in general because it plants the (hemp) seeds of mistrust.
One of the most important organizations making progress on this front at the moment is the Coop Network (GEOMA DAO COOP), which has created its own blockchain, a fork of NXT, a proof-of-stake blockchain. In doing so, Coop provides a private and secure network for manufacturers and suppliers to trace the provenance of ingredients from seed to shelf, enabling ‘proof’ of a superior product. For an industry still finding its feet and navigating the murky waters of regulation and consumer trust, this is a much-needed addition.
“We love the immutable quality of blockchain. Right now we’re talking to several projects in the space that have provided their solutions to other manufacturers, allowing them to show that the materials they use are sustainably sourced.”
Another company advocating for transparency in the CBD industry is Orange County CBD. One of the UK’s largest manufacturers of premium CBD products, who, a few years ago, were one of the first CBD companies to publicly share lab reports for their products. This essential step towards building ‘trust’ within the CBD space meant they quickly became the go-to brand for consumers who wanted to know more about what was really ‘in’ their CBD. “We need to maintain our reputation for innovation and trust, and blockchain technology is the best way to enable traceability of our lab-tested ingredients throughout the supply chain. We love the immutable quality of blockchain. Right now we are talking to several projects in the space who have provided their solutions to other manufacturers, allowing them to show that the materials they use are sustainably sourced.”
When a customer, through blockchain technology, can now know that the cotton used in their clothing was not generated through slave labor, but is obtained from suppliers who practice fair trade, it will be an important USP for brands. When it comes to an industry like CBD, this level of transparency could be a game-changer.
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