Why the CBD Industry Needs Blockchain to Prosper
Why the CBD Industry Needs Blockchain to Prosper
Cannabidiol, or CBD, products have been all over the news since the federal government legalized them in December 2018. A recent Gallup poll found that one in seven American adults have tried CBD products, and 40% of those people use them for pain management. Here is why the CBD industry needs blockchain to prosper.
A proper infrastructure needs to be in place before the CBD sector can thrive.
Major League Baseball is even exploring the use of CBD products to expedite player recovery and mitigate opioid use after the death of Los Angeles Angels pitcher Tyler Skaggs. There’s just one stumbling block: tetrahydrocannabinol, more commonly known as THC.
The World Anti-Doping Agency removed CBD from its list of prohibited substances in 2018, but THC is still banned. Why? Because verifying all the ingredients in CBD products is tricky.
The Los Angeles Fox affiliate worked with TV personality Dr. Mehmet Oz to have laboratories test more than a dozen CBD products, and the results were shocking: Only one product contained the ingredients listed on its label. A separate study found that 70% of CBD products were contaminated.
If businesses and highly regulated sports want to embrace the industry, then they need peace of mind that its products are properly sourced.
Blockchain can be a conduit to needed transparency.
The Wild West of CBD
CBD’s big push does create some added murkiness around compliance issues. This is especially true when federal and state governments are doing little to regulate CBD companies. These businesses sell CBD products as dietary supplements rather than medication, which means they aren’t under the purview of the FDA.
Recent news, however, could widen the FDA’s oversight and put many of those companies selling CBD under a bigger microscope. The agency released a statement recently detailing its belief that, based on its research, CBD could present potentially harmful side effects to users.
The FDA’s reasoning is valid: There’s still little research out there on the effects of CBD, and the information the agency does have points to genuine concerns about the substance’s efficacy. The FDA did uphold its approval of a CBD product designed to cure two rare and severe forms of epilepsy, but it will not legalize adding CBD to foods or categorize it as a dietary supplement.
The ruling by the FDA is yet another instance to illustrate why CBD needs to be regulated by one standard ruling. The only state doing anything in that regard is Florida, which established a regulatory framework to ensure that hemp products are cultivated, processed, and sold correctly. Farms have to register the GPS coordinates of their fields, and sellers need independent laboratories to certify their products.
The uncertainty surrounding CBD regulation is one major obstacle preventing the industry from gaining more mainstream traction. The hesitance some have toward fully embracing CBD could be eased with the integration of blockchain.
It’s Time to Clear Up Confusion
Now more than ever, customers are hyper-aware of the contents and origins of the products they consume. Even if companies aren’t completely forthcoming with ingredients or production practices, customers find ways to uncover that information on their own.
For an industry like CBD, where uncertainty is almost inherent, the transparency that blockchain affords is crucial to ensure the market continues to grow.
Customers want to know that the products they’re using are safe — not testing positive for lead, arsenic, or E. coli. Implementing blockchain into the sourcing process offers transparency that benefits the entire CBD industry.
Companies need to step up in the absence of government regulations and establish industry-wide standards. Businesses can add their products to the blockchain, and third-party testing companies can then examine those products and append the results. Blockchain prevents any CBD companies from editing those reports, which preserves the integrity of the information.
There are plenty of great CBD products out there, but it’s difficult for consumers to find them. Some companies promise miracle results like cures for AIDS and cancer, which erodes public trust when those products don’t deliver. Independent verification can help combat dishonest marketing tactics.
The CBD industry has to win and maintain public trust if it wants to grow. Blockchain puts power into the hands of the people.
When consumers are able to comb through an independent database of CBD products and know that the reports have not been manipulated, then trust in the industry will grow.
CBD products have enormous potential. They may not cure cancer or AIDS, but they can play an important role in our medical system if they can get people healthy faster and relieve pain without any risk of addiction.
Image credit: Rick Proctor — Unsplash
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