The cannabis industry is potentially influenced by the digital currency, Bitcoin. Ever since its creation, the role this mysterious currency has to play in our economics has been studied and questioned. This article is a brief look into what Bitcoin is and whether or not it has a connection with the cannabis industry.
Many readers out there might be familiar with Bitcoin because of its association with the original Silk Road, which was finally shut down in 2013. Bitcoin itself has been around since 2009, and even though it was popular for use on the Silk Road, it has now become somewhat popular as a currency on the market in and of itself. Now, basically anything can be purchased with Bitcoin, including other currencies. Naturally, this online cryptocurrency has made its way into the cannabis industry as a means to purchase seeds, paraphernalia and other products.
Although Bitcoin was originally introduced as an easy and accessible way to deal with finance, it has made its way closer and closer to the drug market and crime. Despite this, it has become legal in some parts of the world to buy marijuana with Bitcoin. As it finds its way into the international market, governments have opened up to the possibilities that Bitcoin offers. For now, using Bitcoin to buy marijuana is a little bit taboo, but it is gaining popularity as the years pass.
A small story about the origin of Bitcoin
Bitcoin was originally created by a group of anonymous programmers under the name of Satoshi Nakamoto. Until now the real creators of this currency platform have not been identified, despite speculations. What makes this currency different from others is that it is decentralized. This means that there is no intermediary between people, or what we would otherwise call a bank. The Bitcoin goes directly from the buyer to the seller, and no one actually makes any money from the trade of Bitcoin.
What also makes Bitcoin unlike money is that it doesn’t physically exist. It’s the people who use Bitcoin who create it, unlike a central bank that controls the printing and distribution of money. The currency is “mined” from the web, in exchange for the computing power of people who want to verify and record Bitcoin transactions into something called the blockchain. There is also no unlimited source of Bitcoin. The producers created 21 million of them at the creation of this currency, and although each coin can be broken down into parts (as small as 1 one millionth of a Bitcoin), no more can ever be created. For some, Bitcoin is a system that makes sense because it means that there is no organization that is directly in control of your money. Bitcoins can also be traded for anything, whether it is products or other currencies.
It is likely that the reason Bitcoin became so popular among illegal traders is because it can’t be traced back to a source. Although all transactions can be traced and are recorded, it is linked to the address rather than to a person. Basically, nobody owns Bitcoins. They are on rent, and although their movements can be tracked, there is no original source of them. They don’t grow interest the same way that other currencies do. In fact, it is not even based on silver or gold the same way banks might deal with other currencies. The value of a Bitcoin is based on a mathematical formula that is available to everybody and is completely open source information.
Can you buy weed with Bitcoin?
The short answer to this question is yes! It is possible to buy cannabis with Bitcoin, and even legally in some countries. This is where the crux of the matter lies. It is not illegal to use Bitcoin because it doesn’t belong to anybody, but its involvement in the “dark web” (such as clients like Silk Road) means its use can be a little bit shady. Actually, it is not recommended at all for Bitcoin users to enter the dark web because they essentially lose all rights over their money and products by doing so.
Actually, the question lies more in whether or not it is legal to buy cannabis in your country. In some countries where it’s legal to buy, it’s still illegal to buy cannabis online and this is a factor, too. The matter of whether or not weed and weed products can be purchased with Bitcoin will depend on which Bitcoin friendly store you are purchasing from and which country you live in. Some stores have become Bitcoin friendly, and from there you can purchase seeds and even other smoking products with Bitcoin currency.
Does the legal marijuana industry need Bitcoin?
There are some cannabis economists in the USA who are arguing that Bitcoin could be a future possibility for marijuana. In fact, some operations in Colorado have already begun using Bitcoin as a way to pass the judgments of financial institutions. The response of the financial institutions in the USA to the booming marijuana industry actually came as an unexpected event. Because of the federal stance on the matter, many banks flag cannabis companies and refuse to do business with them. This has left many dispensaries, farms and producers a bit puzzled about what to do.
Although Bitcoin bypasses this problem and makes trading fair and legal for cannabis companies, it’s also not that easy to convince buyers to use Bitcoin. Nonetheless, marijuana economists believe there could be some reason behind the desire to use this currency as a platform. In an industry that is expected to bring in billions of dollars, a solution to this problem is now necessary. The problem is bigger than we think, however, because it requires a complete re-education on how to buy and sell products using a currency such as Bitcoin.
What is the future between Bitcoin and cannabis?
At this stage, a relationship has already been developed between Bitcoin and marijuana because of this currency’s pervasion over the online black market. Whether or not it is a positive relationship, it already exists. What is extremely positive is that there are now friendly websites that accept Bitcoin without the buyer having to go into the dark web, where things can get messy. Bitcoin provides solutions to some of the financial problems that companies face, as well as expanding the platform on which marijuana can be marketed. In this way, we can say that Bitcoin definitely holds its advantages. If it can be integrated into the regular transfer of currency, who says it can’t play a role in the trade of marijuana?