Cannabis Fund to Sell Crypto Tokens to Raise Capital

With crypto tokens, Global Cannabis Capital (GCC) is looking to raise more capital, Bloomberg wrote Monday (April 18).

The report said the company is about to start selling tokens on the Ethereum blockchain platform which show its equity instead of a traditional IPO.

While GCC originally planned to do an IPO or a reverse public offering in Canada, which is marijuana-friendly, the company ended up looking into its options and is now pursuing a security token offering.

This will occur in Luxembourg, where regulations are favorable to both pot and the idea of issuing securities with blockchain.

The company is using a security token, though, which means its backed by the assets or equity of the user.

Token offerings are a way to do this that might be able to broaden the funding sources available to the pot industry, which cant borrow money from banks because of marijuanas illegal status at the U.S. federal level.

So funding has mostly come from venture capital and other sources like wealthy individuals and individual shareholders.

We cannot wait 12 or 14 months to go through an IPO process. Tokenization takes around three months, Chief Executive Officer Andres Israel said in an interview at the companys main office in Montevideo, Uruguay.

To carry out the offering, GCC plans to make 100,000 tokens representing its capital stock.

PYMNTS wrote that cashless ATMs have been good for processing around $7 billion in cannabis transactions.

See also: Cashless ATMs Mask Estimated $7B in Cannabis Transactions

The report says legal cannabis retailers have had problems making and dealing with payments because of the fact that cannabis isnt legal federally.

That makes it difficult to accept payments aside from cash. A loophole, though, makes it so cashless ATMs could process as much as 25% of the estimated $28 billion projected to come in from the U.S. dispensary sales.

Bloomberg said the sales might make up around $500 million in fees for payment processors.

——————————

NEW PYMNTS DATA: THE FUTURE OF BUSINESS PAYABLES INNOVATION STUDY APRIL 2022

Plastiq - The Future Of Business Payables Innovation: How New B2B Payment Options Can Transform The SMB Back Office - April 2022 - Learn how all-in-one payment solutions can help businesses streamline B2B transactions and remove AP and AR management frictionsPlastiq - The Future Of Business Payables Innovation: How New B2B Payment Options Can Transform The SMB Back Office - April 2022 - Learn how all-in-one payment solutions can help businesses streamline B2B transactions and remove AP and AR management frictions

About: While over half of SMBs believe that an all-in-one payment platform can save them time and improve visibility into cash flows, 56% believe that the solution could be difficult to integrate with existing AP and AR systems. The Future Of Business Payables Innovation Report, a PYMNTS and Plastiq collaboration, surveyed 500 SMBs with revenues between $500,000 and $100 million to explore how all-in-one solutions can exceed SMBs expectations and help future-proof their businesses.