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Marijuana Stocks v. Cryptocurrencies: The Key Difference

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marijuana cryptocurrency

The marijuana boom has nothing short of explosive.

So much so, investors are comparing the run to that of cryptocurrency.

But there’s just one difference.

Just look at Tilray Inc. (TLRY) for example.  

In just weeks, the stock skyrocketed from $29 to more than $300 a share for a few reasons.

One, we’re nearing October 2018 legalization in Canada.

Two, the company’s medical cannabis product was successfully imported into the United Kingdom for a pediatric patient in need.

Three, the U.S. will allow the company to export marijuana.

Four, CEO Brendan Kennedy told CNBC that the world’s pharmaceutical companies need to think about partnering with cannabis producers as a hedge against the space.  “Cannabis is a substitute for prescription painkillers, prescription opioids, and so if you’re an investor in a pharmaceutical company or you’re a pharmaceutical company, you have to hedge the offset from cannabis substitution.”

The buzz generated in the press is nothing short of astounding.

And yes, it’s just as exciting as the cryptocurrency boom.

But there’s one difference. Cryptocurrencies have staying power. They’ll be around for years.  The technology behind them are changing just about everything in the world. Governments, companies, investors, and even you and I won’t know a world without blockchain or cryptocurrency.

But when it comes to marijuana, the rally may be short lived.

Once legalization in Canada happens in October 2018, the anticipation of the event will be priced in. And profit taking may begin.

All comparisons aside, cryptocurrency is likely to generate a bit more long-term buzz.

Blockchain may Even Assist in the Marijuana Industry

Advocates of blockchain technology are advising governments and investors to pay attention to its potential role in monitoring marijuana.

In 2017, Canada asked for advice on how the country can manage the emerging marijuana market. IBM responded, telling Canada to look into the benefits of using blockchain technology.  “IBM suggests Blockchain is an ideal mechanism in which B.C. can transparently capture the history of cannabis through the entire supply chain, ultimately ensuring consumer safety while exerting regulatory control from seed to sale.

As we near the October 2018 legalization, more discussion on blockchain technology and its potential use is likely to take place.



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