Weed and fintech in the same sentence. Wow! I for one just had to explore this combination. Well, now that Canada has legalized “weed” (OK, cannabis) and several states here in the U.S. have also, it is a huge growing industry (like it…..or not) and fintech fits perfectly into this space. Think about this; money exchange (bitcoin,etc), payment technologies, “seed to sale” tracking (Microsoft and partner Kind), smart contracts AND, of course, self driving cars for when you are like……….stoned. Oh one other, passive investing via artificial intelligence ETF’s which will allow for more ‘downtime’ to get high. Who cares if the market crashed dude.
(Bill Taylor, CEO)
“Justin Trudeau made significant moves this week to legalize cannabis in Canada and last year’s US election saw several states do the same for recreational use. In 2016, the US and Canada spent a total of $53.3 billion on legal cannabis products, according to Arcview Market Research, so it is safe to say this industry is already booming and will continue to do so if more markets legalize marijuana. What does this mean for the fintech industry? Money is handled and exchanged within all business sectors and that is why payment technologies are being taken up quicker and used extensively in comparison to the likes of self-driving cars, for example.
Last year saw Microsoft’s cloud computing business partner with Los Angeles startup Kind to create a product that would track marijuana plants from ‘seed to sale’, according to The New York Times. Executive director of state and local government solutions at Microsoft, Kimberly Nelson, believes that there will be growth in this sector. ‘As the industry is regulated, there will be more transactions, and we believe there will be more sophisticated requirements and tools down the road,’ Nelson said. The article went on to describe how Microsoft’s name attached to the marijuana industry will somewhat legitimize it, which I think will be the cannabis fintech arena’s biggest problem in the future.
The New York Times also highlighted in an earlier article the importance of fintechs for the legalization of cannabis. Despite Colorado decriminalizing the drug in 2014, Visa and Mastercard refused to process transactions made at dispensaries and in turn, banks refused to open accounts for them, which then left a lot of cash in limbo. This is where the fintech startups come in and will solve issues that the traditional banking sector may not know how to handle. I spoke to representatives from Tokken, Green Bits, WebJoint, M. J. Freeway and Merry Jane about what they’re currently working on and that is revolutionising the marijuana industry…”