DMG Blockchain Solutions (TSX-V: DMGI) plans to build a global supply chain management for the legal cannabis industry using blockchain technology.
In a statement, DMG said that it is working with an undisclosed technology partner to build the cannabis supply chain solution. The company plans to first launch the platform in Canada, and subsequently expand globally.
Currently, DMG is in talks with cannabis industry players, including major licensed producers, quality assurance labs, retail distributors, and government regulators, according to the company.
Blockchain Perfect For Building Cannabis Supply Chain Management System
“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 and cannabis producers, processors and distributors,” DMG CEO Dan Reitzik said in a prepared statement.
“The first use of blockchain was bitcoin, but the perfect use is supply chain management for controlled products such as cannabis. Canada is being positioned to be the global supplier of cannabis, and our blockchain platform can help enable this by way of product traceability for rapid recalls, ensuring a legal source of product, enhancing product safety, as well as facilitating and automating legal and taxation compliance,” Reitzik added.
Key capabilities of the planned supply chain management software include
- Supply chain automation on blockchain.
- Development of interfaces between the blockchain platform and legacy systems to allow automated transactions and process flows utilizing smart contracts.
- Integration of existing ERP systems with the blockchain platform to support automated triggering of events such as defective product recall or the resupply process.
- Integration with licensed producers, licensed distributors, retailers, shippers, as well as reporting and auditing systems.
- Onboarding of new participants.
Cannabis represents a $23 billion industry in Canada alone, including an estimated $6 billion in revenue from 13 million recreational users. Various market reports suggest that the global cannabis market could exceed $500 billion.
U.S. Customs Testing Blockchain-Powered Supply Chain Management System
In related news, the U.S. Customs and Border Protection (CBP) is testing a blockchain-powered supply chain management. At a recent meeting of the Commercial Customs Operations Advisory Committee, officials discussed blockchain and other emerging technologies.
Vincent Annunziato, director of CBP’s Automated Commercial Environment Business Office, said that they are “looking at blockchain technology to see how it can be used in the supply chain arena. He noted that the CBP has built a hybrid system that allows public sharing of data and also maintains the security of that data.
Further, Annunziato said that the CBP is currently testing blockchain as a proof of concept and hopes to have some recommendations by the December meeting.