In early November, IBM, the “Big Blue” technology giant, recommended that the BC government adopt blockchain for the cannabis industry as a way to protect consumers, prevent fraud, and increase transparency while maintaining regulatory control over the industry, from seed to sale.
What is blockchain?
Blockchain was originally created as the backbone behind Bitcoin, the digital currency which has recently seen its value soar from $3000 CDN per coin a few months ago to over $14,000 today, but the applications for blockchain technology go far behind cryptocurrencies- and that’s why IBM has recommended its use for the supply chain management of cannabis.
According to IBM, “Blockchain is a highly effective trust mechanism which uses a cryptographically-secure shared ledger to irrefutably track complex transactions amongst many known parties.”
Basically, blockchain is a shared ledger where all transactions are recorded and updated in real-time, and once recorded, these transactions cannot be altered. So, IBM is saying that not only will blockchain allow for the easy tracking of cannabis throughout all levels of its production, but because it is an immutable shared ledger, the transactions are secure.
Some American companies are already using blockchain to track cannabis, and it is also used in similar ways by the pharmaceutical and food industries.
The benefits of using blockchain
According to IBM, “Blockchain can help the Provincial Government take control of sourcing, selling and pricing of products, therefore [it] can reduce or eliminate black market sales completely”, while helping producers manage their inventory and get insight into consumer behaviours and trends.
Also, since every transaction is recorded, “if poor product does enter the system, the controls, methods and ability to quickly identify its’ path is in place”, which is good news for cannabis users considering all the medical cannabis recalls from licensed producers for everything from mislabelling to using banned pesticides.
Photo credit: MIT Technology Review
Province of BC: IBM input to BC cannabis regulations.