Given the heated legal and political debates surrounding the cannabis industry, it can be a challenge for sellers of cannabis products to find merchants to facilitate financial transactions. Many retailers and independent distributors are banned from dealing with banks and credit card processing companies by federal legislation. Even though thirty-three states in the United States have legalized cannabis consumption, sellers still have a difficult job processing financial transactions.
Many cannabis businesses have been driven to drastic measures, such as storing cash is duffel bags and even burying money. This means many business owners are stressed out, as they are constantly worrying about being robbed or ripped off. Fortunately, almost two decades after the millennium, there are now some great alternatives to banks.
Smart people around the world have been busy creating cannabis-specific cryptocurrencies, designed to make it super easy to complete cannabis-related financial transactions. In the cryptocurrency world, you might have already heard a little bit about Bitcoin, but there are now hundreds of other cryptocurrencies. Some of those cryptocurrencies have been specifically designed with the cannabis retail sector in mind.
Cryptocurrency: What It Is?
When many people hear the word “cryptocurrency,” they assume it’s some sci-fi jargon from a futuristic movie. The futuristic nature of it makes its very appealing. A cryptocurrency is basically a decentralized, anonymous, peer-to-peer electronic currency. Back in the 1980s, the idea of such a digital currency seemed very unrealistic. These days, however, new cryptocurrencies are emerging all the time.
Both cannabis sales and cryptocurrency transactions operate separated from the mainstream legal system. So, it’s perhaps not surprising to see the two industries uniting to provide consumers and vendors with the services and products they desire. Some of the most popular cannabis cryptocurrencies are Cannabis Coin, DopeCoin, and PotCoin. While the names are not very inventive, at least they are self-explanatory.
You can listen to Radiolab’s Podcast about the newest cryptocurrencies and the paranoia surrounding them by clicking here.
Are Cannabis Cryptocurrencies Here To Stay?
The cryptocurrency world is forever evolving at a super-fast rate. As a consequence, many currencies suffer from instability, making some businesses feel hesitant about adopting them. Their hesitation is entirely justified. All types of cryptocurrency can be extremely volatile. Coin prices can fluctuate massively over the duration of a day or even an hour. Consequently, retailers that accept cryptocurrency payments need to monitor and adjust their product prices on an automatic, continuous basis to avoid losing money due to fluctuating exchange rates.
While Bitcoin has proven that it has staying power, not all cryptocurrency are destined to be around for the long term. Düber, for instance, is just one of many examples of cryptocurrencies that disappeared overnight. Even Düber’s website is now gone.
One of the main benefits of buying cannabis products with cryptocurrency is that it provides some anonymity. That anonymity is attractive to customers who don’t want to reveal their personal information when living in a country where the consumption of cannabis is widely criticized. There are both benefits and drawbacks to the implementation of cryptocurrency-based payment systems in the cannabis industry. Time will determine whether cannabis cryptocurrencies are here to stay.