As we have previously said, blockchain technology is transforming every sector of the global economy. This is majorly attributed to asset tokenization, the process of representing tradable assets on a blockchain network and representing them as tokens. Currently, the cannabis industry is another stage that is ripe for blockchain disruption.
Until recently, funding for the cannabis industry was limited to private loans, angel investors, or venture capital backing. Tokenizing your cannabis business will give you access to a new avenue for generating growth capital while recording all transactions on a blockchain network. This will improve the transparency and clarity of business, leading to a better investor relationship and trust.
An Overview of the Cannabis Industry
Colorado was the first state in the US to legalize recreational cannabis in 2014. The subsequent years saw nine other states following the Colorado path. Since then, the cannabis industry has experienced a significant boom, creating thousands of jobs and millions in tax revenue.
A huge user base and lack of previous legal competition make this industry ripe for investment. Sadly, the federal regulation on cannabis bars banks from servicing the cannabis industry. This makes cannabis-asset-backed tokens the perfect payment solution for various industry participants, like dispensaries, customers and growers.
Tokenization- A Revolutionary Way to Fund the Cannabis Industry
The Tokenizer end-to-end Defi infrastructure enables cannabis-based businesses to fractionally sell equity or shares in crop futures to a larger pool of investors. This opens up the market to a new class of investors eager to tap into this thriving industry. These are the benefits of tokenizing your cannabis business to various industry players:
Cannabis cultivation demands a considerable amount of start-up capital. Seeds, land, labor, pesticides, licensing, and harvesting are all capital-intensive activities, proving difficult to growers. Tokenization enables farmers to generate capital for individual operations or join forces for collective farming.
Since the cannabis industry still experiences a gray legal framework, funds can be challenging to generate and are subject to intense scrutiny from multiple regulatory agencies. Tokenization presents immutable on-chain storage of all token funding information, including unsold tokens, ownership history, appraisals, and other essential information.
Growth capital from traditional financial institutions is largely inaccessible if you deal with cannabis products. Angel investors and venture capital firms prioritize their interests when you approach them for funding. However, tokenizing your business interest will enable you to raise the capital necessary for your business growth.
Opening your cannabis business to a new class of investors will likely draw more capital and growth in the entire cannabis industry. This industry has previously been inaccessible to average investors. Since it is highly profitable, many global investors would be willing to onboard, improving market liquidity.
Investors will no longer be pushing you towards a liquidation exercise. Tokenizer DEX is a regulated marketplace that enables investors to trade their asset-backed tokens 24/7 throughout the year.
Tokenizer Blockchain Banking Platform
Tokenizer is a blockchain investment banking system that champions accessible, transparent, and safe financial services. We believe that everyone deserves equal access to investment and fundraising opportunities. That is why we are democratizing access to capital for investors and fundraisers by making investing and fundraising efficient, safe, and accessible to everyone.
Are you in need of raising funds or investing in security tokens? Apply to raise funds through Tokenizer by filling this application form. If you want to invest in security tokens, sign up for a Tokenizer Investment Account today, and if you want to liquidate and trade-in Asset-Backed Tokens, we have a decentralized exchange designed for you!
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