Cryptocurrencies and cannabis are a match seen as providing investors with the perfect high in profit they seek. At least this is what the backers of pot-based digital currencies claim.
Currently, the medical marijuana industry faces the huge challenge of establishing a relationship with banks since many financial institutions are reluctant to allow sector players to open business accounts. Exacerbating the problem is the hardline stance of the US administration on the cannabis industry.
"You just have to realize this administration is not pot-friendly. You are still dealing in a world where what you are doing on the federal level is still illegal."
Incidentally, Jalil is also executive director of the Wall Street Blockchain Alliance - a non-profit trade association focused on promoting blockchain.
Cryptocurrencies as alternative payment methods
According to industry players, pushing for virtual currencies as alternative payment methods in cannabis-based transactions “will provide the financial glue” because this would solve the sector’s cash problems. In addition, by tapping the niche for a financial solution in the emerging marijuana sector, cryptocurrencies could expect a windfall profit.
Sahar Ayinehsazian, head of regulatory affairs at cannabis business-focused law firm Vicente Sederberg, said:
"The appeal is figuring out a viable solution to the cannabis cash problem -- it is a very lucrative area and a large part of my career is built on cannabis banking."
There are several marijuana-focused cryptocurrencies the industry is looking at right now. The most popular of them is PotCoin courtesy of Dennis Rodman, who was seen last summer wearing a PotCoin t-shirt in North Korea. Others are DopeCoin, CannabisCoin, HempCoin, and the newest, CannaCoin.
CannaCoin, or Cannabis Coin, recently saw its value drop after peaking above $0.20, but the virtual currency is creating sufficient noise to grab the attention of prospective investors.
Change in admin offers hope
Jalil is hoping that a change in administration and a decision by the federal government to classify marijuana as a legal drug can ensure a bright future for the industry.
"I guess the idea is to buy now and hope for an administration change. If pot were ever to be declared not illegal, I would want to be the marijuana business. I think it would explode. It would be like coming off of Prohibition."
But for Stuart Titus, CEO of Medical Marijuana, the real breakthrough will come when cannabis starts trading as a commodity or an asset-based security.
If that happens, Titus believes “the cannabis futures market might be the largest futures market in the world."