DMG Solutions to Develop Blockchain-Based Supply Chain. In a landmark decision, the Canadian government legalized recreational marijuana as of October 17 last week. Cannabis was previously available for medicinal use within the country since 2001. Canada now becomes the second country in the world, after Uruguay, to legalize marijuana, as reported by Canada’s national public news and information service CBC.
According to Health Canada, there are currently over 120 licensed cannabis producers in Canada. One of the top producers has already predicted that labor shortages and supply chain issues could lead to scarcity soon after marijuana becomes legal.
The cannabis industry is expected to grow 35% a year and to amass to $35 billion in retail sales by 2022. In a separate study conducted by Deloitte, entitled: “Recreational Marijuana: Insights and Opportunities,” the researcher states that cannabis represents a $23 billion dollar industry in Canada alone, including an estimated $6 billion in revenue from 13 million recreational users. Various market reports indicate that the global cannabis market could exceed $500 billion. Bigger tech companies and startups are beginning to see opportunities in this emerging sector of the economy. In addition to the companies already affiliated with this particular market, some technology startups are also looking at how blockchain can be used to disrupt the cannabis industry. One of these startups is DMG Blockchain Solutions Inc. (DMG), a diversified blockchain and cryptocurrency company that manages, operates and develops end-to-end digital solutions to monetize the blockchain ecosystem.
DMG’s CEO Dan Reitzik, asserted:
“DMG Solutions to Develop Blockchain-Based Supply Chain. The emerging cannabis industry demands product management solutions and blockchain is the most logical choice. We want to be the first to offer an enterprise-grade solution in partnership with leading technology providers. Also, with cannabis producers, processors, and distributors. The first use of blockchain was bitcoin, but the perfect use is supply chain management for controlled products such as cannabis. Canada is positioned as the global supplier of cannabis, and our blockchain platform can help enable this by way of product traceability for rapid recalls. Also, ensuring a legal source of the product, enhancing product safety, as well as facilitating and automating legal and tax compliance.”
DMG, together with its technology and finance partners, is currently in talks to develop a cannabis supply chain solution with cannabis industry players, including major licensed producers, quality assurance labs, retail distributors, and government regulators. This global blockchain initiative intends to comply with the specific requirements of all the industry players.
The key planned capabilities of the new global supply chain management solution will include supply chain automation on blockchain; application of artificial intelligence; IoT (The Internet of Things); machine learning; and tight integration across the entire supply chain and development of interfaces between the blockchain platform and legacy systems. This level of comprehensiveness will allow for automated transactions and process flows, utilizing smart contracts. Other capabilities will include the integration of existing ERP systems within the blockchain platform; supporting automated triggering of events such as defective product recall or the resupply process; integration with licensed producers, licensed distributors, retailers, shippers; reporting and auditing systems; and onboarding of new participants.
Blockchain technology is active in agriculture and food supply chains. Earlier this month, IBM launched its blockchain-based food tracking network, Food Trust, to connect different parties in the food industry. During the trial period, which started August 2017, the company partnered with Nestle SA, Dole Food Co. Also with Driscoll’s Inc., Golden State Foods, Kroger Co., McCormick and Co., McLane Co., Tyson Foods Inc., and Unilever NV.
Earlier in September, U.S. retail giant Walmart, and its division Sam’s Club announced they will require suppliers of leafy greens to implement a farm-to-store tracking system based on blockchain to “dramatically [improve] efficiency.”
We are increasingly seeing the implementation of Blockchain technology in daily usage sectors. Yet, it remains in its early stages, therefore we can only anticipate greater and more exciting things to come.