By Meni Morim, CEO of Namaste Technologies
Blockchain is making headway in the cannabis industry by improving consumers’ and suppliers’ trust. Characterized by a distributed ledger system that stores data, blockchain helps trace cannabis products from seed to consumption, maintain product quality and authenticity, and create a foundation for further technology to centralize data.
Although Health Canada currently requires all cannabis companies to have a seed to sale ERP system, which is a technology that tracks where the strain came from to provide consumers with a safe and legal product, cannabis consumers may still have doubts that the product they’ve chosen is actually the product they’re getting. This is where blockchain becomes useful; with a digitized data system, it helps determine the product’s authenticity, quality, and traceability.
Blockchain gives consumers the ability to track product truly from seed to consumption, so they can see where it was acquired, grown, packaged, shipped, and actually consumed by the end user.
Currently, the cannabis industry lacks a central database for strains. Product testing is done by Licensed Producers (LPs), but consumers and suppliers have little access to the data. Blockchain creates infrastructure to unify this information and allows further technology to be created where LPs can upload data for consumers’ and suppliers’ easy consumption, increasing their confidence in the strains.
Although blockchain is in its early stages in the cannabis industry, its ability to track products across the supply chain is improving the entire process. For cannabis suppliers, blockchain’s insight into where the product came from helps them better source strains and understand why some products are successful and why some aren’t.
The ability to trace products is a major asset, as it allows suppliers and producers alike to more accurately predict demand. It also gives insight into where products were consumed and why they are or are not selling on the business-to-business, business-to-consumer, retail, and online levels.
For consumers, blockchain provides more knowledge about their products and mitigates concerns about where they came from. For example, cannabis consumers can scan the product code on an app to immediately get information about that specific strain.
Suppliers are beginning to recognize the importance of tracing products and centralizing data, and consumers are seeking more information on their cannabis strains. These two factors alone can increase the likelihood of blockchain becoming widely adopted by cannabis companies and potentially even becoming a prerequisite infrastructure.