Belgravia Capital And Cannabis Science Announce Blockchain Plans Because Of Either Innovation Or Desperation
Following Tuesday’s announcement by struggling cannabis social media company MassRoots of the launch of their new wholly-owned subsidiary MassRoots Blockchain Technologies, Inc. comes news of two more entrants into the blockchain space, Cannabis Science, Inc. (OTC PINK: CBIS) and Belgravia Capital International (CSE:BLGV) (OTCQB:BLGVF). The former announced on Wednesday plans to launch a blockchain cryptocurrency ICO in partnership with Crown Baus Capital Corporation, while the latter hopes to create a fully-sustainable blockchain-based subsidiary to complement the cannabis sector.
With both companies trading well below $1 per share it begs the question are these moves more an act of desperation over innovation? Separate but intertwined all the same, the cryptocurrency/blockchain space is more bravado than anything when linked with cannabis and has yet to make a dent in the sector.
According to a statement, Cannabis Science is still in the process of finalizing their cryptocurrency blockchain plans, with hopes of announcing its completion shortly. Together with Crown Baus Capital, the company is working on structuring a deal that benefits all shareholders while leveraging the capabilities of both a blockchain initial coin offering (ICO) alongside their pharmaceutical drug development programs.
“These types of agreements closely align with the interests of CBCA and CBIS in drug development and financial security, thus enabling each company to focus on its particular area of expertise,” said Raymond C. Dabney, President, CEO, and Co-Founder of both companies. “I believe this is a very smart move for a number of reasons, considering the size of the pharmaceutical drug development industry and the newly formed crypto-currency blockchain industry, so we are looking to add two or three engines to this blockchain thing and see what it does.”
Meanwhile, Belgravia is staying away from cryptocurrencies and hoping to harness blockchain technology as a way to develop a decentralized medical cannabis database. The goal is for both retail customers and distributors to use the database to search for terpenoid and flavonoid content as well as the source of genotype and phenotype.
For all of its bluster though, blockchain and its cousin cryptocurrency have never caught on in the cannabis industry. According to an article from Leafly in early November, as innovative as cryptos are, the cannabis industry continues to work in cash. Moreover, while blockchain does appear to have what it takes to revolutionize the industry, no one has put it to use yet. For all of the press, IBM received last year for suggesting blockchain to the Canadian government; there is yet to be an official contract signed.
So why do companies like MassRoots, Cannabis Science, and Belgravia think blockchain is the answer?
For one hype has always brought in investors. As Cory Flanigan, chief technology officer of Tokken told Leafly in November when discussing ICO’s, “It’s a savvy move for fundraising. By building their own coin to sell to speculators, they can raise a bunch of money to achieve their vision.”
Mostly though it has to be seen as an act of desperation - Belgravia is trading at $0.25 per share, with a market cap of $59.6 million. Cannabis Science’s price is half that, at $0.12 per share. In a crowded cannabis sector, blockchain may be the only way these companies can stand out.
As John Downs, director of business development at The ArcView Group told Leafly in November, “There’s a lot of sound and fury, but it doesn’t signify as much for the cannabis industry as one might believe if they just read the headlines.”