"In the cannabis industry, there is a lot of heavy regulation, and a lot of misleading news that causes extra complications for the industry," said Nadav Segal, one of the company's founders. "I meet with investors who fund companies with a 5-10 year outlook, and when they hear about cannabis, they say that it is too risky for them. We provide a solution that makes the industry more secure, by authenticating data about the supply process and making it transparent using blockchain technology. We hope that by bringing more transparency to the industry, it can gain more acceptance."
Using Transparent-C's management solution, photos and biometric data for each plant are uploaded to the blockchain cloud at different stages along the production path, so that medical and recreational buyers can verify the source and quality of the supply at any point. The company already has contracts in place with suppliers in Romania and Malta, as well as with an Israeli herb exporter, Bless Technology, Segal said.
As states around the world adopt more liberal legislation for marijuana usage in recent years, the dangers of black-market supply has come to the forefront. Growers in some regions are recognized for the quality of their crops, and it is relatively easy to try to sell inferior merchandise at higher-level prices.
Cannabis plants contain an enormous number of active ingredients that can affect the body in a variety of ways. Each strain can contain dozens of different cannabinoids and terpenes in varying amounts, and ingesting the wrong one can cause adverse effects, especially in the medical cannabis field.
For example, while several studies have so far found that certain strains of cannabis sativa could very well help mitigate two of the more severe symptoms of COVID-19 – fibrosis and inflammation of the lungs – one of those studies also found strains that had the exact opposite effect.
Countries that have legalized marijuana for medical or recreational use tend to have detailed regulatory procedures to ensure products' quality, safety and efficacy. However, Segal said, tracking each plant's entire journey via blockchain, where every piece of data can be verified individually, adds a much greater level of trust to the entire process.
The process of identifying a cannabis plant typically relies on many varying external and subjective parameters such as plant height, leaf color, stem diameter and measured active ingredients, which can make identification extremely unreliable and lead to faulty identifications.
"Our technology gives any buyer a complete picture of where each plant has come from, and easily helps suppliers avoid unnecessary compliance expenses and save money," Segal said. "We are looking to make the cultivation process completely transparent for regulatory compliance offices, customs officers, doctors, and patients so they can check any link in the supply chain from seed to end product."
Idan Zonshine contributed to this report.