The Industries Most Impacted By The Legalization Of Cannabis

By Trevor McDonald

For an industry that’s still relatively new, we’ve seen some amazing success stories come directly from cannabis sales. In states like Colorado, marijuana is surpassing alcohol in tax revenue, which helps funnel funding to schools and other important programs.

But legalized marijuana also has a broader impact. Its effects can be felt in various industries, but some are impacted more than others.

The following industries have felt the most impact from the legalization of cannabis:

Cryptocurrency
Under federal law, cannabis is still treated like any other controlled substance. As far as the federal government is concerned, cannabis is illegal, regardless of what each individual state has to say about it. This may change with the VA Medicinal Cannabis Research Act of 2018, but dispensaries remain cautious. Because of the legal gray area surrounding marijuana, 70 percent of cannabis companies use cryptocurrency instead of traditional banks.

Education
In states where marijuana is legal, we’re seeing a major boost in funding for education. This comes from the increase in tax money collected from cannabis sales.

To drive this point home, let’s look at Colorado as an example. Between 2015 and 2017, the Colorado Department of Education received over $140 million from cannabis revenue alone.

Oregon schools received an extra $40 million in tax revenue in 2016.

Software and Technology
Where cannabis is legal, all states require a seed-to-sale tracking system. Although there are a few companies providing software for the job, two emerge as leaders. METRC is one such company, and they received nearly $900,000 in their first contract with the state of Colorado. MJ Freeway made headlines when it secured a $10.4 million contract with the state of Pennsylvania for their seed-to-sale tracking system.

Alcohol
There are many industries singing the praises of legalized cannabis, but the liquor industry is not one of them. You might have guessed that alcohol sales would take a hit when cannabis became legal, but a few researchers at the University of Connecticut and Georgia State University wanted to see the full picture. As it turns out, alcohol beverage sales fell by 15 percent following the introduction of marijuana sales. With easier access to marijuana, people don’t seem to be drinking as much alcohol.

Big Pharma
The pharmaceutical industry has been fighting marijuana legalization since before it was legal anywhere. This because they stand to lose a lot. As people start taking cannabis and stop taking prescription painkillers for common injuries, big pharma loses. As people choose CBD oil instead of Prozac, big pharma loses. Whenever a prescription medication is replaced with cannabis, it equates to a loss for the pharmaceutical industry. In fact, one report estimates that if the entire nation legalized cannabis, the pharmaceutical industry would lose an estimated $18.5 billion in the span of three years.

Whenever anything of value enters the market, we can expect it to make major waves. Cannabis is no exception. In most industries, its impact is favorable. We’re only seeing a decline in the industries where cannabis replaces something. But based on the long and short-term effects of alcohol and prescription drugs, marijuana’s impact may still be favorable.

Bitcoin’s Rise Solidifies The Intersection Of Cannabis And Cryptocurrency

NEW YORK: As bitcoin’s price continues its meteoric rise, which has seen the cryptocurrency skyrocket in value from just under $1,000 at the start of 2017 to above $10,000 in November, a number of companies have taken steps to benefit from the growth of the burgeoning cryptocurrency industry.

One area of the industry that appears to offer significant growth potential is the application of bitcoin and other cryptocurrencies to sectors of the economy, such as the cannabis industry, that are blocked from accessing banking services. 

The intersection of the growth of the cannabis and cryptocurrency markets has created a promising environment for firms looking to capitalize on the robust growth currently occurring in these industries. Legalization of the use of cannabis for medical and recreational use by governments around the world has led to powerful demand for the product, which shows no signs of letting up anytime soon. This is reflected in a report by Grand View Research, which projects that the cannabis market will reach $55.8 billion by 2025.

Similarly, the ability of the blockchain to provide a decentralized, encrypted ledger to store records in an efficient, verifiable manner without requiring assistance from intermediaries has facilitated growth in the cryptocurrency market. The blockchain serves as the backbone of cryptocurrencies such as bitcoin, and its radical transparency has enabled the use of bitcoin to process high risk transactions, such as those in the cannabis industry. In a sign of the growing mainstream acceptance of the cryptocurrency, the U.S. CFTC recently gave approval to the CME CBOE exchanges to start trading bitcoin future contracts on Dec. 18 of this year.

 

GreenMed Launches Cryptocurrency-Based Credit Card Processing App For Legal Marijuana Industry

CALIFORNIA: Pro-cannabis cryptocurrency startup GreenMed has become the world’s first one-stop shop for electronic payments in the legal marijuana industry. The platform enables customers to pay for legal marijuana with credit and debit cards. Apart from allowing card payment at dispensaries, the platform also allows users to pre-purchase for quick pick-up over its app.

GreenMed is the first platform to implement an ERC20 Ethereum token-backed application for the convenience of both customers and legal marijuana dispensary operators. The platform uses cutting-edge electronic payment processing technology in conjunction with Ethereum blockchain to execute credit card transactions.

Due to strict federal regulations, banks have been unable to partner with legal marijuana dispensaries, leaving cryptocurrencies like Ethereum as one of the only options to help the $5 billion industry accept mainstream electronic payments like credit/debit cards and electronic fund transfers. They can also choose to pay with digital currencies.

While the GreenMed application allows patients to pay for their legal marijuana with credit cards and cryptocurrencies, merchants can be issued GreenMed debit cards which enable them to withdraw accumulated funds directly from any ATM. The GreenMed debit cards can also be used at PoS and online payment gateways to make purchases, just like any other debit card.

In addition to convenience, GreenMed also provides a secure option for legal marijuana dispensaries to handle their earnings. In the absence of such a solution, the dispensaries are forced to conduct all transactions in cash which not only increases the risk of theft but also cuts into the margins due to high operational costs involved in securing and transporting cash.