Cannabis is currently legal in some regions or nations. Legalization plays a vital role in the growth of the cannabis sector.
The current trend that is taking over the cannabis sector is NFTs. So, you may ask yourself, what is an NFT? An NFT is a piece of data stored in the blockchain, and it is unique to a particular piece of data; thus, it cannot be interchanged.
We can all agree that cannabis is indeed an exciting product. Although it is legal, there are different parts of the world where the drug is illegal. So, you may ask yourself, why is cannabis being likened to cryptocurrency?
The current correlation is because of the NFTs (non-fungible tokens). The Cannabis and NFTs are currently generating huge sums of money; the media hype is also advantageous. For instance, Jack Dorsey, the Twitter founder, sold the first tweet to be ever made for $3 million. Other pieces of NFT digital art have been sold for huge sums of money, including video games, music, and even videos. Cannabis and NFTs are here to stay, and their value will rise progressively.
As an entrepreneur who has invested in the cannabis sector, you may want to learn more about how you’ll gain from NFTs. Also, how will the cannabis industry gain from NFTs?
What is an NFT?
We have already explained what an NFT is. The main question that you should be asking yourself is, how do the NFTs work?
Cannabis brand NFTs are in the form of digital certificates, and they are traded on blockchains. Most people may assume that cryptocurrencies are the only items that can be traded on the blockchain. Well, anything can be digitized and sold as an NFT. The cannabis brand NFTs data is encrypted on the blockchain as a token. A digital certificate is then attached for authentication purposes.
When an NFT is transferred or sold, the blockchain will verify the certificate. Each NFT is unique. You now understand the correlation between cannabis and NFTs. If an NFT is copied, the duplicate won’t have a certificate, and it will be marked as in-genuine.
NFTs usually demonstrate limited utility. They usually come in handy for promotions, games, and branding. Currently, artists have a new stream of revenue. Considering there are no concerts amid the pandemic, famous artists have sold the NFTs for considerable amounts of money.
Currently, the Ethereum cryptocurrency is the one being used to process the NFTs. Keep in mind the other cryptocurrencies can also process the NFTs.
Before the popular cryptocurrency Bitcoin became more of an asset, tech-savvy individuals would use Bitcoin to purchase different products on the dark web. The cryptocurrency usually promotes anonymity, and it is also untraceable, which makes it suitable for drug trafficking, among other illegal acts.
Currently, most traffickers are using Monero. Hydra is also famous in the cryptocurrency scene. There are also other alternatives such as DopeCoin and PotCoin, and they are used to purchase legal substances such as weed that are regulated by the state.
Currently, the non-crypto blockchains come in handy when tracking shipments of legal weed. The chain-of-custody ensures that licensed pot firms don’t break the law considering there is proof of compliance. The main advantage is that the pot companies can keep their licenses as long as they don’t engage in illegal acts. Blockchain tracking is currently common in Canada. There are also operators in the U.S. who are currently utilizing the technology. The main advantage of blockchain is that it ensures looping won’t take place such that people cannot acquire more cannabis than allowed by the state.
The Peakz Co. is a cannabis firm based in California, and it managed to sell the first digital weed strain in the form of an NFT. The strain is referred to as dubbed Lava Coin. The highest bid was $4,500. You may ask yourself, what can I do with a digital weed strain? The main focus is currently on uniqueness. The individual responsible for innovating the Lava Coin is confident that we’ll get to see more of such things in the future. The NFTs will also help to protect proprietary genetics.
The branding in the cannabis sector is dependent on the strain. Some strains are being used for breeding more superior ones. If the cannabis strain is unique, you can acquire a patent; however, you’ll need to part with a significant sum of money. Fortunately, there are NFTs, and they take less time, and you won’t need to spend a lot of money on a patent.