Listening to regulators from countries like the U.S. and India leads one to believe that there is nothing good to say about cryptocurrency. Regulators frequently talk about crypto as though a total lack of redeeming qualities makes it completely worthless. What many of those regulators do not realize is that their very opinions are a driving force behind cryptocurrency and blockchain projects.
As just one example, consider a brand-new cryptocurrency just announced by a wealthy Greek entrepreneur named Alki David. His SWX Coin is completely unique in the world of cryptocurrencies. Moreover, it serves just one purpose: to facilitate worldwide payments for the cannabis industry. SWX Coin will become the cannabis industry's currency of choice if David has anything to say about it.
This post will break down exactly what David is doing and why he is doing it. By the time you finish reading, you should have a better understanding of the appeal of crypto to so many business owners and investors who consider themselves outside the mainstream. You will discover why cryptocurrency is never going away, even if regulators decide to outlaw it worldwide. Now that cryptocurrency is out of the bag so to speak, people are going to use it one way or another.
A non-inclusive banking system
David's foray into cryptocurrency is neither an accident nor an experiment in technology. It is the direct result of his business activities and the fact that world banks are not necessarily friendly to him. Mr. David, for all intents and purposes, is discriminated against by a non-inclusive banking sector that doesn't agree with one of his business ventures.
You see, Mr. David is involved in the cannabis business. He is also a member of the family that owns Coca-Cola Hellenic, the largest bottling company in Europe. His activity in cannabis is a lot more recent than his family's activities in the bottling industry.
David is a big proponent of cannabis and hemp products. He is also a businessperson with a keen eye for opportunity. He understands that cannabis businesses worldwide have trouble securing banking services because governments do not take a very positive view of what they do. So David came up with a solution. He created the first bank designed around cannabis transactions.
David's Swissx Bank of Cannabis is currently headquartered in Gstaad. A second Caribbean headquarters is expected to open at some point in the future. Because Swiss banking regulations are much more liberal than most other parts of the world, David can legally transact business among cannabis-based companies without issue. He plans to do just that.
The bank will utilize the SWX Coin as a token for moving money between clients and within the banking structure itself. It will work side-by-side with the Swissx Global Hemp Exchange, an exchange that does for cannabis what cryptocurrency exchanges do for Bitcoin, Litecoin, etc.
A turn-key banking solution
David sees the combination of these three assets as a turn-key banking solution for anyone involved in the cannabis industry. Customers can use the exchange to buy and sell cannabis on world markets; they can use the bank to handle all their financials; they can buy into the cryptocurrency to take advantage of fast, encrypted, transparent payments.
This is something that the cannabis industry has been hoping would pop up for some time now. Unfortunately, theirs is an industry that is a lot like cryptocurrency in the sense that it is a mixed bag of legality. Cannabis is fully embraced in some jurisdictions, illegal in others, and somewhere in between in the rest. That makes banking exceedingly difficult.
Take the U.S., for example. Cannabis is considered an illegal and controlled substance at the federal level. But a growing number of states have legalized it for medical reasons. A smaller number have legalized recreational use. Cannabis businesses in the states have an incredible market to tap into but, because of federal laws, banks do not want to touch their business.
This leads businesses to deal only in cash. That may not seem like such a big deal unless you are a business owner sitting on tens of thousands of dollars in cash and nowhere to deposit it. You instantly become a target among smart thieves who figure out how much cash you are actually dealing with.
Tying crypto to cannabis
Setting aside ethical questions and focusing only on the business aspect of cannabis as a commodity, what David has decided to do is a brilliant stroke of economic genius. He has identified a very clear need that the traditional banking sector is not willing to meet. He sees the current market worth millions, a market that will be more than happy to run its transactions through his institution just so that individual players do not have to handle so much cash.
David also made a brilliant move by tying the value of his SWX Coin to the global price of cannabis. He has essentially created a digital currency that is both a stablecoin and a utility coin. He will have accomplished with SWX Coin what Satoshi Nakamoto intended for Bitcoin, on a much smaller scale of course, if his plan succeeds.
Assuming that is the case, SWX Coin will have built-in utility. It will be a coin designed exclusively for the purposes of transacting cannabis business. That will make the coin extremely useful which, subsequently, will also make it valuable to those who use it. And by tying the coin to the value of cannabis itself, worries of price volatility are eliminated.
How it will all work
By now you are probably wondering how all this will work on a practical, day-to-day basis. It starts with Swissx, the very first company to introduce cannabidiol (CBD) products to the global market. With a strong brand and business model behind it, Swissx provided the impetus for launching the bank, the exchange, and the cryptocurrency bearing its name.
As for the bank, it got off the ground with US$1 billion in financial backing from a number of investors. The coin followed soon thereafter, along with what is known as the Farmer's Wallet. The wallet is exactly as its name suggests: a digital wallet that allows cannabis growers around the world to transact business in SWX Coin.
When a grower puts his or her cannabis on the exchange for sale, any proceeds realized from the sale are deposited into the grower's wallet as SWX Coin. The cryptocurrency can be exchanged for fiat at any time and without restriction. Those who want to purchase cannabis from the exchange first buy SWX Coin from the bank.
Like any other cryptocurrency, you get in on SWX Coin by purchasing coins from the provider for fiat. You can then use them to transact business with anyone else willing to accept them. Your coins can be liquidated at any time by simply converting them back to fiat.
A grower's cooperative
David has further solidified his company's business model by creating a grower's cooperative in the Caribbean. This explains why the Swissx Bank of Cannabis plans a Caribbean headquarters. They want to be flexible enough to meet grower needs without requiring growers to always be in contact with the Swiss headquarters.
The point of the cooperative is to provide the financial resources growers need to support their businesses in the Caribbean. Reports indicate that the cooperative is already flourishing, accepting new members and growing quickly across the region.
Having a dedicated bank in their corner gives cannabis growers access to financial tools and resources they otherwise would not have at their disposal. By joining the cooperative and shifting their finances to the Swissx Bank of Cannabis, they can do business just like any other.
Freedom to do business
The title introduction of this post indicates that SWX Coin illustrates the appeal of cryptocurrency. If you are still not sure why, it comes down to a simple phrase: the freedom to do business. That's what cryptocurrency has always been about.
Way back when Satoshi Nakamoto first launched Bitcoin, his or her goal was to create an alternative monetary system that allowed individuals to transact business without interference from governments or central banks. Nakamoto was smart enough to know that governments and central banks do not operate on a level playing field. They control money and, as such, commerce as well.
As for SWX Coin, its whole purpose is to give cannabis businesses the freedom to do business. Rather than being inhibited by government and banking regulations that only hinder free enterprise, they can conduct business through a Swiss bank that welcomes them and their money.
This is why cryptocurrency will never die. Now that people fully grasp the freedom crypto gives them, they are not going to give that freedom up. India is about to find that out. If the Indian government moves forward with plans to make cryptocurrency illegal in that country, it is a safe bet that individual consumers will not stop using it.
Regardless of where you stand on cannabis as a consumer product, it is also here to stay. Now companies in the cannabis business have a safe and effective way to transact among themselves thanks to SWX Coin and the bank behind it.