Cryptocurrencies and cannabis seem to share a lot of things in common; for starters, both face many challenges from financial, regulatory, and even political. Interestingly, their bases seem to overlap as both industries are quite popular with younger demographics. These shared traits aside, crypto and cannabis boast complementary business models that can bolster each other as adoption in the two industries grows.
Challenges Facing the Crypto And Cannabis Industry
Despite being around for over ten years, cryptocurrencies are still seen as fringe financial tools by the mainstream media, financial institutions, and the public. Compared to existing government-issued currencies, cryptos are quite new, and they don’t enjoy the day to day use everywhere except in a few tech pro locations in Europe and some few major cities in the U.S. and Asia. It’s safe to say they are quite unfamiliar with the masses.
Part of it has to do with the fact that the technology is still in development. Transaction speeds are still a problem, and this presents issues for merchants accepting them. Add volatility which they are rife in, and you have another reason why few businesses and institutions are willing to handle them.
Regulation is also a major stumbling block, and in 2020 governments around the globe are still trying to figure out how to regulate virtual currencies.
On the other side, Cannabis being a new industry faces its own share of problems. In a country like the U.S., even though several states have legalized the use of marijuana under certain conditions, it’s not legal on the federal level.
That said, few financial institutions are willing to offer loans or credit to cannabis-based enterprises since it’s still a new industry and the sticky legal issues brought about by differing state rights.
The fact that marijuana isn’t legal on the federal level in a country like the U.S. doesn’t help since banks are expected by the law to be federally insured. This means…