How Blockchain Technology Protects the Cannabis Supply Chain

Cannabis technology in lab testing

The leading problem in the legalized cannabis, CBD, and hemp industry is an absence of trust and reliability. And when you take a look at the industry, it’s not difficult to see why.

With alarming frequency, reports find a lack of transparency in CBD and cannabis product messaging. One report found that approximately one-quarter of CBD products aren’t tested for microbial content, pesticides, or heavy metals. Due to the tendency of the cannabis plant to absorb toxins from soils, this presents a real threat to the health and safety of consumers.

The root of the problem is that demand for legalized cannabis products is moving faster than the regulations that ensure the quality and safety of those products. This results in a disparity between what consumers expect and what they often receive. The question is, how can we solve this issue?

The answer: technology. Keep reading to learn about how blockchain technology can support safer commerce in the legalized cannabis, CBD, and hemp industries.   

The State of the Legalized Cannabis, CBD, and Hemp Industry

The federal government has allowed states to make their own laws and regulations for cannabis and CBD products. This often results in confusing messaging in a rapidly evolving landscape. 

Most cannabis companies are doing their best to run their businesses the right way, however, some bad actors are electing not to put in the time, effort, or financial investment necessary to ensure their products are high-quality and compliant with regulations.

Increasing demand and competition in the market sometimes lead to lab shopping and fraudulent Certificates of Analysis (COAs). As a result, many of the products in circulation are mislabeled or contain misleading marketing messaging on product packaging, social media, and websites. 

There are instances of litigation cases where those involved were taken to the ER because the products they consumed contained compounds that were not noted on the label.

I believe the solution to these problems is advanced technology, in particular, the power of blockchain. Let’s explore why. 

Blockchain Technology and COAs

Blockchain technology effectively prevents any COA tampering and modification in the Qredible® platform by rendering all documents immutable upon submission. The test results are submitted by a 3rd party lab facility. The lab report data collected includes the testing equipment and LIMS data along with the certificate of analysis (COA).  

What is Blockchain Technology?

Using a multi-layered security approach, blockchain technology makes it difficult or impossible to change or hack a system of recording information. It is a decentralized digital ledger of transactions that is duplicated and distributed across the world. 

Once lab report data and the COA report are written into the blockchain, the information cannot be overwritten. Labs can make corrections, but only by recording new data and linking it with the old.

What is a COA?

COAs are verified documents that provide details about the testing lab, the brand, and the product being tested. They contain crucial information about the potency of the ingredients and raw materials. 

In the case of hemp, CBD, and cannabis, the ingredients refer to cannabinoids like THC, CBD, CBG, and CBN. 

USDA and state guidelines require that all products be tested. That’s because COAs are vital for consumers to determine whether or not a product is free from harmful contaminants such as heavy metals, pesticides, molds, and bacteria. Consumers should never consume or buy a product if there is no COA available.

Blockchain COAs: Technology for Cannabis Consumers

In the current market, consumers want to know what they’re ingesting. Recent reports have found an increase in demand for transparency that applies to all consumable goods, which includes cannabis. 

To meet this growing demand, many companies are beginning to implement strategies such as QR codes that allow customers to view more information about their products. Companies in Qredible can use their QR code to demonstrate their commitment to transparency. They do this by allowing customers to view validated and blockchain-secured COAs. 

Other companies can publish COAs as a feature on the product page on their website. Unless these COAs are submitted to blockchain directly from a 3rd party lab facility along with the testing equipment and LIMS data, it will not be possible to ensure they have not been tampered with in some way.

Blockchain Technology: Cannabis Businesses

There are many use cases for blockchain technology in the cannabis and CBD industries. Blockchain can allow a business to trace a product from seed to shelf. This improved visibility can be leveraged as a powerful value driver and could lead to cost savings and more revenue.

Companies can also take advantage of the technology to verify and validate the authenticity of other businesses’ COAs. This could protect them from becoming involved with an untrustworthy company and shield them from legal risk and reputational harm.

Qredible’s solution includes the use of blockchain technology to store COAs along with the testing equipment (instrumentation) and LIMS data, which can be used to validate the contents of a COA.

The Future of Technology and the Cannabis Industry is in Qredible®

Blockchain can improve supply chain transparency and traceability while reducing a company’s overall costs. 

Nestle is a great example of this. Nestle uses the same blockchain technology as Qredible to allow customers purchasing coffee to scan a QR code and get information about the origins, farmers, harvest, roasting period, and more. Our implementation approach to blockchain in the cannabis and CBD industries is similar.

The cannabis and CBD industries can be revolutionized with the adoption of four major disruptive forces in technology: cloud computing, blockchain, the internet of things (IoT), and machine learning/artificial intelligence (ML/AI). 

Qredible is committed to the use of these four technologies in its solutions. We are using artificial intelligence to evaluate the compliance of text, images, and videos on e-commerce sites selling CBD and cannabis products.

As technology evolves, so do the possibilities. Sensors and the IoT can provide the complex data necessary for course correction in product development and for producing a consistent final product. I am excited about the future ways in which we will apply innovative and disruptive technologies to improve safe commerce in legalized cannabis and CBD.

Qredible is the only digital registry of verified and validated legalized cannabis, hemp, and CBD brands. Want to be in Qredible? Get started today. 

Ronaldo Möntmann

Ronaldo Möntmann

Ronaldo is the Chief Information Officer here at Qredible.

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