Developer of innovative software and hardware for the purchase and sale of cryptocurrency via point-of-sales systems, Virtual Crypto Technologies, has announced the development of a proprietary crypto payment solution specifically developed for cannabis dispensaries.
The innovative technology, projected to be released in Q4, will provide dispensary owners, in the United States, with a solution that will enable them to allow users to purchase cannabis products with cryptocurrency, including Bitcoin.
Within the United States, the legalised production and consumption of cannabis is growing. Currently, there are nine states that have legalised recreational marijuana, while thirty states (plus the District of Columbia) have legalised medical marijuana. Even with legalisation, financial institutions are raising their eyebrows in regard to this market and are creating difficulties for new enterprises entering the cannabis industry.
In fact, legally established dispensaries are unable to collect payment with credit cards. As a result, many dispensaries open bank accounts under an alternative identity, while others operate almost exclusively in cash or use other workarounds.
The Virtual Crypto solution will facilitate transactions with local dispensary shops where marijuana dispensaries are legal and recognised by the US government. The company provides a financial solution which allows for a more efficient and effective way to collect payments. Virtual Crypto has is designing a customised payment method specifically for the marijuana industry, which can also be used by the farming industry in this sector as well as medical and recreational dispensaries.
Cannabis dispensaries and the related farming industry face significant financial challenges. Few banks are willing to provide loans or credit to marijuana-based enterprises due to their conservative nature and their perception of the market and the inherent legal issues that arise when states’ rights come into play. Marijuana businesses have been forced to use cash due to the position financial institutions have taken with this sector. The Virtual Crypto solution solves existing payment problems and also alleviates some of the safety hazards that exist within a business that currently deals mostly in cash by enabling crypto payment solutions.
Virtual Crypto Technologies CEO Alon Dayan, stated: "Our cannabis payment solution is building upon the foundation we established with our first-generation point-of-sale system. Virtual Crypto has been validated in the market and is a proven technology. Not only does our solution make it easier to accept payments, it also provides a record of transactions, which ensures alignment with government oversight, eliminating fraud and abuse.”
Virtual Crypto has created a simple process that brings cryptocurrency one step closer to being a legitimate payment method for cannabis purchases. For one to purchase cannabis via the Virtual Crypto solution, a user will simply scan a QR code that appears on the dispensary’s point-of-sale screen’s interface, which represents a series of unique variables regarding that specific transaction. Within seconds, the store owner will receive confirmation in accordance with the number of goods sold. The software, like other Virtual Crypto solutions, provides real-time transactions and ensures the best exchange rate at the lowest commission offered on the market. Virtual Crypto's proprietary algorithms scan multiple exchanges to provide customers with the best value at the time of the transaction.
As Virtual Crypto’s current solutions for point-of-sale systems where Virtual Crypto's NetoBit software is installed, a verification algorithm instantaneously predicts with a very high degree of precision whether the cryptocurrency transaction will be authorised by the Blockchain. This process happens immediately following the submission of the transaction and before confirmation when the block is signed. As a result, the software can verify transactions within seconds to minutes, instead of the standard ten minutes to 24 hours, following the current process of six authorisations.
Dayan added: "Today with cash as the payment method of choice at dispensaries, they have quickly become a target for thieves. With tens of thousands of dollars in transactions per day, employees are faced with an unsafe work environment. Additionally, cash makes it difficult to account for the appropriate payments of taxes to the government."
Virtual Crypto’s cannabis solution can facilitate the reduction of cash payments and the amount of cash moving through the industry as a whole. Adoption of cryptocurrency won’t eliminate cash completely from the cannabis industry but will help the industry shift to a more standard cash usage rate of approximately 30%.
Dayan finished: "Our goal is to be an alternative payment option, not to eliminate cash. We believe our technology can ultimately reduce the amount of cash moving through the cannabis ecosystem, which will help foster a safer work environment and ensure industry participants pay their taxes using an alternate payment method. The Virtual Crypto solution is a win-win-win for dispensary owners (and farmers), consumers, and individual states- resulting in accountability, ease of use, and increased tax revenue to the state.”