Now that cannabis is becoming legalized, organizations and consumers want to feel confident that the products are legal, clean and safe. A blockchain platform called Paragon is aiming to provide a solution to the current challenges faced by the marijuana industry.
What is blockchain?
Many people are familiar with Bitcoin, a cryptocurrency that uses a decentralized ledger system for financial transactions. Cryptocurrencies use blockchain technology, a platform for peer to peer transactions that don’t require any central institution, such as a bank, to manage the exchange.
Blockchain technology is so named because transactions are compiled into blocks of encrypted data which are chained together into a permanent ledger. A blockchain is a public record that is shared and duplicated on machines throughout the world. This enables a transparent, secure, self-managed system that eliminates traditional paperwork and manual procedures. As a result, transactions are faster and more accessible to people around the world.
Blockchain has uses other than exchanging digital coins. It can function as a self-managed database of records, documents and transactions that are permanent and encrypted. Blockchain platforms can also create and enforce digital contracts, called “smart contracts,” that mitigate the need for lawyers or governing bodies. Consequently, organizations in many different industries are developing blockchain systems to streamline their operations.
Why the cannabis industry needs blockchain
As public opinion shifts toward legalization, more government bodies have the burden of managing an emerging, booming industry. There are still legal ambiguities and a lack of banking solutions that hinder business operations. Consequently, some businesses are not able to grow, while others are prevented from entering the market.
There are also problems for consumers. Ambiguous or nonexistent regulations put consumers at risk because they can’t verify the authenticity of the products or have any guarantee of a product’s quality or safety. Patients need to be able to identify exactly what type of product they’re buying in order to fulfill their medical needs. Also, poor regulations may force some consumers to buy from sellers of ill repute.
Blockchain can provide solutions to these problems. The technology enables businesses to forgo the fees and paperwork associated with bank transactions. Also, consumers can use the platform to push for regulations that are better and standardized across the country.
Cannabis has already grown into a billion-dollar industry. As society becomes more open to the legalization and sale of cannabis, Paragon will be a very important platform to help businesses grow and give consumers a safe alternative to addictive painkillers.
