The world’s fastest-growing industry – cannabusiness – has 3 critical blocks we are going to explore with you: the state, taxation, and financing. Cannabis army, forewarned is forearmed. Fire at will!

1. The Top 3 Problems That Could Kill the
Cannabis Business
Description:
The world’s fastest-growing industry – cannabusiness – has 3 critical blocks we
are going to explore with you: the state, taxation, and financing. Cannabis army,
forewarned is forearmed. Fire at will!
Table of Contents:
The Cannabis Bet
Politics and The State
Cannabis Ban’s Key Milestones
Democrats vs. Republicans
The Magic Wall and the U.S. Voldemort
Taxation
Finance: Infrastructure and Resource
Infrastructure
Resource
Reverse Takeover (RTO)
Hypocrisy
Conclusion

2. The Cannabis Bet
Cannabis is the litmus paper for demonstrating the maturity of society. We are living in great times to
witness historical events. And they are positive, man! We are getting more mature – just great times!
Evolution is a process based on challenges. “Challenges” means risks. There is no other way.
You are welcome to explore the potential blocks to getting into the big leagues of the cannabis business.
The Golden Green Leaf League is forming before our very eyes. And it’s not only about huge money:
2018 N.A. Consumer Market – $11 billion U.S. = Malta GDP (2017)
2030 N.A. Consumer Market – $75 billion U.S. = Georgia, Cyprus, Iceland, and Estonia’s GDPs (2017)
all put together.
We are about to create history in the cannabis industry, both in the States and worldwide.
Extremely responsible initiatives are necessary to mitigate risks. These must be well-known in order to
provide analysis and prepare appropriate solutions (if possible). Forewarned is forearmed.
“If possible” means there are success and risk factors, which include:
 The first row. We can reach it ourselves to tune and enhance (please refer to our following
materials on payment solutions, supply chain, data management and identification, and reputation
management.)
 The second row. Factors can be changed with a temporary intermediary, which is the state; we
can influence it, but in the loooong-term perspective and with a lot of luck.
The first group of risk factors is more about operational activity, while the state factor is about industry’s
foundations. Let’s start dissecting that one first.
Politics and The State
Cannabis is at least twice as old as the state, which had its first examples 3,000 B.C. (some of the earliest
archeological hemp evidence, from about 10,000 B.C., comes from rope imprints on broken Chinese
pottery.) The state developed, progressed, and reached the stage of “L'état, c'est moi” concept (“I am the
State”) with Louis XIV, also called The Sun King, only four hundred years ago. There is democracy on
the street nowadays. At least, we are allowed to think so.
The state is permanently evolving, and there is hope that we will reach the liquid “sister” of the current
pseudo-democracy in the near future. This will bring us efficiency and a higher rate of evolution, in the
state as well as society in general. Why?
There is no longer any doubt that cannabis is real magic that provides humanity with medicine (e.g. to
treat cancer), cosmetics, food, clothes, and construction materials. It is also an eco-friendly plant in terms
of growth and harvesting. But it took 5,000+ years to reach the milestone of cannabis becoming a legal
substance. It took us 5000+ – it is about speed and efficiency.
Cannabis Ban’s Key Milestones
Cannabis has a dramatic history of legalization. And don’t think that this is only about the modern world
– the fight is too old. The first recorded cannabis ban happened 700+ years ago: Soudoun Sheikouni, the
Emir of Joneima in Arabia, prohibited cannabis to his subjects. That ban period lasted all the way up to
the early 2000s. It even included the cannabis stronghold, Jamaica: it banned cannabis with the Ganja
Law, supported by the white ruling class and the Council of Evangelical Churches in 1913.

3. If we speak about cannabis legalization history in the U.S., we should focus on laws at the federal level
first. Cannabis persecution was launched in the U.S. 1937: The Marijuana Tax Act was enacted,
effectively prohibiting cannabis at the federal level. That was the first step to stop marijuana. Although
medical use was permitted, new fees and regulatory requirements significantly curtailed its use. If
someone was going to use cannabis for commercial purposes, they had to pay USD $1 per ounce in
federal tax. If there were any other purposes, they had to pay USD $100 per ounce. Please pay attention to
the fact that 1 U.S. dollar in 1937 vs. 2018 held quite a different value: USD $1 in 1937 is worth almost
USD $20 in 2018.
There was a bright moment in U.S. history when cannabis was legal on the federal level. Due to Timothy
Francis Leary – a brave man, real hero, great writer, psychologist, developer – and his arrest because of
marijuana, the courts struck down the 1937 Marijuana Tax Act. Dr. Leary’s astounding legal success was
short-lived, however. The Supreme Court gave its final judgment on May 19th, 1969, and on October
27th, 1970, the U.S. enacted the Controlled Substances Act (CSA).
The Marijuana Tax Act was an analog of prohibition, with analog results and a booming black market
until the 1960s and ’70s. This was why the second critical step was taken in 1970: the CSA was enacted,
officially prohibiting cannabis for any use (medical included) at the federal level. Under the document,
cannabis is still classified as a Schedule I substance: it is in the same category as heroin, MDMA, and
LSD. What a lovely neighborhood! And that neighborhood is about real criminal prosecution.
Democrats vs. Republicans
U.S. politics is divided into two groups – Democrats and Republicans – to provide us with a fiction of
choice. The two groups have nearly the same attitude toward cannabis challenges, with varying degrees of
focus on the issue. The two above-mentioned cannabis criminalization milestones were reached during:
1. Franklin Delano Roosevelt’s term. The only U.S. president to be elected more than two times. He
was on a par with other monumental figures in U.S. history, like George Washington and
Abraham Lincoln. Democrat.
2. Richard Milhous Nixon’s term. The first and the only U.S. president to resign from the position
(ha ha...bad luck because of marijuana persecution). Republican.
So, there is almost no difference in terms of the prevailing political establishment in the U.S..
Nevertheless, it would be fair to state that Democrats are a little bit more progressive. For instance, their
Republican colleagues were not ready to support the legalization initiative in Washington, D.C. in 2014,
while the community was fully ready to take the upgrade in terms of recreational and medical cannabis
use.
That tiny difference provides Democrats with a tool to attract young voters in the right place at the right
time. At the elections in California in November 2010, the legalization of cannabis question was put on
the ballot and attracted young voters. This brought victory and the position of Governor of California to
the Democrats.
The cannabis issue became a very effective tool to attract an audience and manage its attitude to the
current and future state of things in term of political preferences. This includes the latest victory, with
hemp-friendly updates to U.S. Farm Bill due to an overwhelming vote 86-11 in the Senate (June 2018).
The signature of King Twit provided the States with cannabis-based clothes, rope, oil, plastics,
construction materials, etc. The country jumped into the race with China, which has been the biggest
hemp producer since the Vietnam War: hemp was used to make more breathable uniforms for their
soldiers in the intense heat.
Despite a certain level of thaw in politics and the law, there have also been risk factors. And this is not
about history, but the present time.

4. The Magic Wall and the U.S. Voldemort
Attorney General Jeff Sessions was practically waging war on the pot industry at the beginning of 2018.
That could have been really big trouble for multi-billion-dollar business:
The Sessions initiative to rescind the Cole memo was successful in January 2018. The memo served as
policy guidance to U.S. attorneys, making the cannabis industry a low prosecutorial priority in states that
had legalized cannabis. It was created to protect market participants from federal prosecution in case the
area of business operation had already legalized cannabis. Removing this memo gave state-level
prosecutors the discretion to bring cannabis charges against people or businesses, even in legal states!
The above-mentioned “upgrade” did not mean DOJ agents were standing in line near each dispensary to
prosecute the one (but...check it out just in case). There is a second magic wall protecting cannabusiness:
The Rohrabacher-Farr/Blumenauer Amendment. The spell is as follows:
None of the funds made available in this Act to the Department of Justice may be used, with respect to the
States of Alabama...and Wisconsin, to prevent such States from implementing their own State laws that
authorize the use, distribution, possession, or cultivation of medical marijuana.
And this magic has been activated for the 2019 fiscal year. God save its creators!
Jeff Sessions became a part of the history as soon as he was fired by Trump at the beginning of November
2018. But is there any guarantee there are no more “Jeffs” in the state management team?
The cannabis industry is the fastest-growing on the planet. It is a reflection of people’s wants and needs,
and their attitudes in terms of legalization:
The level of American support for cannabis legalization. Source: Gallup
Despite the fact that Democrats and Independents are more cannabis-friendly than Republicans, there is a
joint positive trend too – we are human beings first, and voters second:

5. The level of support for cannabis legalization from the perspective of political preference. Source: Gallup
Politics and the state is a risk factor worldwide at any time. But the cannabis industry is developing and
maturing. It has a certain lobby already, and it will become more and more powerful. This will bring more
stability and predictability in terms of the state actions. Including taxation policy.
Taxation
This block is based on the previous one. Taxation is the state. Fees and regulatory requirements are the
immortal tools of the government, and they are more than real today.
70-90% is the tax rate for the pot business in States. Justin Trudeau, we love you with your 10% tax!
There is now definite progress compared to 1937, when people had to pay up to USD $62.50 in tax per
gram (1/28 oz.). But tax wall stays too high. This could have been perceived as a dead end for the
industry, but its growth does not correlate with its negative tax background. Most companies are
balancing between near-zero margins and losses – there is no other way to take a piece of the market pie.
Cannabis is illegal on the federal level, and there are hard consequences in terms of business obligations
and mechanics to determine how much it needs to pay into the budget. If a Schedule I substance is your
business, say “bye!” to take normal corporate income-tax deductions. Pot businesses are unable to use a
normal tax-to-pay calculation scheme because of U.S. Tax Code 280E.
U.S. Code › Title 26 › Subtitle A › Chapter 1 › Subchapter B › Part IX › § 280E:
No deduction or credit shall be allowed for any amount paid or incurred during the taxable year in
carrying on any trade or business if such trade or business (or the activities which comprise such trade or
business) consists of trafficking in controlled substances (within the meaning of schedule I and II of the
Controlled Substances Act) which is prohibited by Federal law or the law of any State in which such
trade or business is conducted.
Checkmate.
There is the “cost of goods sold” exception, which allows you to deduct inventory costs, including the
cost of the product, shipping, and any directly related expenses. But prior deep investigation must be
done, because the IRS has its own understanding of the current legislation.

6. The next mini-good news for cannabis businesses that operate in pass-through form (like a partnership or
LLC, sole proprietorship, or S Corporation – a business that pays taxes through its owner’s personal tax
returns) can be found in Section 199A: the one should consider if the new Section 199A deduction can
partially offset deductions disallowed under Section 280E of the Internal Revenue Code.
Creativity is an essential part of entrepreneurship. It is no secret that the cannabis business uses
sophisticated structuring to optimize its tax base. A management company is a tool to separate Section I-
infected activity from another part of the business to file a tax return claiming all ordinary deductions. As
a bonus, you even have the ability to open a bank account as “a regular business”.
The state stops commending such creativity as soon as it cuts into budget revenues. Business does not like
revenues declining, and the state is no exception.
Here is California again at the stage and the case of “Alternative Health Care Advocates (AHCA) vs.
Commissioner of the IRS”. AHCAs provide medical marijuana to individuals in the Golden State. There
is the entity to interact with an end user. It operates as a cannabis business company. There is a
management service provider as a partner too – Wellness Management Group, Inc. – to deal with a
number of business functions, like hiring employees and managing HR, paying wages, paying advertising
expenses, paying rent, etc. Briefly speaking, S corporations could be found providing management
services to marijuana businesses which are trafficking in controlled substances for §280E purposes.
As a result, AHCAs should rethink their business model, and must pay taxes twice (the first time on
behalf of themselves, the second from the account of Wellness Management Group, Inc.):
Petitioners also argue that applying section 280E to both Alternative and Wellness is inequitable because
deductions for the same activities would be disallowed twice. These tax consequences are a direct result
of the organizational structure petitioners employed, and petitioners have identified no legal basis for a
remedy.
One important detail is that the Management Company had the only client, and that client was a cannabis
company. Colleagues, the state does not believe in such coincidences.
The above-mentioned case will likely be appealed, so let’s keep an eye on that, wishing all the best to
brave Alternative Health Care Advocates. The best position is not only to observe, but to act. Thank you
so much, NORML! The industry must continue to concentrate its participants’ efforts on finally get
Congress to repeal the Section 280E tombstone.
And let’s keep in mind that Al Capone was arrested not by FBI agents.
“They can’t collect legal taxes from illegal money.” --Al Capone
“Yes, we can!” --the IRS
We are not Al Capone, but the state has another point of view that we are here to change. There has been
the first federal prison sentence for tax crimes already, so we must be extremely accurate and… active in
terms of interacting with the law producers.
Finance: Infrastructure and Resource
How much does USD $1 million weigh? Cannabis market players will take no time to answer, “From 1
ton with USD $1 bill to 10 kilos with USD $100 note.” And they got this knowledge not from Google,
but their own everyday practice.
An USD $11 billion industry operates in cash. Almost in cash only.

7. Infrastructure
Cannabis is banned on the federal level, keeping its Substance I status due to a law that is over 50 years
old. Banks are mostly federally chartered entities, and thus find cooperation with cannabis company to be
like putting a black spot on their arms by themselves. It is like inviting government bodies to a bank.
Anyone who provides financial services to a marijuana business (a legal marijuana business!) faces
possible criminal prosecution for “aiding and abetting” a federal crime as well as money laundering. And
it seems that other banks’ “marginal” activity is more profitable and predictable than that of newcomers.
To be clear: there is no ban on financial institutions having a marijuana grower or retailer as a client.
Banks are able to serve green leaf business participants, but there must be scrupulous and resourceful
filing of suspicious activity for every transaction involving the pot business. And this is not only about the
first row clients of the bank in terms of interacting with the industry (e.g., a grower sold 1 kg of cannabis
to a retailer). Those filing and reporting rules are about first-row clients’ counterparties too (e.g. grower
paid his bill to an electricity company). This results in mountains of red tape and expenses that most
banks simply choose to not deal with.
Just having a bank account (if you are lucky to find an appropriate partner) does not mean you can
operate with debit/credit cards. MC or Visa will not provide pot businesses with merchant accounts till
federal and local state laws are equal (in favor of local, legalized mode).
Cash is inconvenient to customers and hard to operate with. It is risky and costly to operate with: cash
businesses tend to lose 10 percent due to theft. Guess who pays this extra…
Resource
Financial resources are the life’s blood of any business. The U.S. cannabis business is suffering now, and
that damages further growth and expansion. This is only possible with a healthy amount of investment
and infusions of working capital. But…
Federal banking restrictions play badly with the cannabis business in terms of resource supply: the U.S.
stock exchange is closed to it. No listing, no money. No money = no honey. This refers to the U.S., but
not its northern neighbor, which collects that honey with a huge appetite.
Canada has legalized cannabis on the federal level, meaning that all institutions are allowed to do
business with cannabis companies. Including banks and exchanges.
This does not mean that the whole Canadian market is welcoming U.S.-based pot companies. Yep, hard
choice: to get good interest or avoid creating a powerful competitor. The threat is that this choice is
flexible, and can be changed over time.
Moreover, the Toronto Stock Exchange (TSX) position is fixed as not allowing American pot business to
enter the capital market through its gates. It states that all American cannabis companies doing business in
Canada are “not in compliance with federal regulations.” The biggest Canadian exchange operator, the
TMX Group, is less adamant, with a 50/50-attitude. It warns its existing and potential clients that
cannabis companies with activities in the U.S. and Canada are not in compliance with TSX requirements,
and may get delisted.
But there are more hospitable institutions, like the Canadian Securities Exchange (CSE). It hosts 120
cannabis stocks with a number of companies that have their roots in the States.
The M&A cannabusiness market is booming, too, and Canada is a definite leader here:

8. Cannabis M&A, 2018. Source: Dealogic
The U.S.-based pot business, however, is not going to calm its pace. One of the best examples of this is
Acreage Holdings.
An interesting fact about the team is that it includes a former Canadian Prime Minister, Brian Mulroney,
on its board of directors. That’s a lovely synergy, isn’t it? And the team is really heavyweight-powered:
former Speaker of the United States House of Representatives John Boehner and former Governor of the
State of Massachusetts Bill Weld are on the Board of Advisors. No Country for Old Men? Come on!
Reverse Takeover (RTO)
The company, which was founded in 2014, is hunting USD $200 million in private placement, which
would value the company at between USD $2 billion to USD $2.5 billion. It should be mentioned that
Acreage Holdings is looking to raise capital via a reverse merger/takeover (RTO), which is a frequently-
used scheme to enter the Canadian capital market.
RTO is also a frequently-used scheme to enter the capital market in the United States in general. Because
it is faster, it is relatively easier: no need to register with state bodies (the SEC in the U.S., the Canadian
Securities Administrators in Canada), and no need to proceed with a months-long roadshow.
The scheme is simple: a private company (U.S.-based) acquires a public company (Canadian), which is
already trading on the public exchange. The public company has no activity, no executives, no revenue –
it is just a shell, a skeleton to put muscles on and start running with ASAP.
And ASAP means a lot to cannabis-market newcomers now, because the industry is more than booming.
It is critically important to be the first on the market.
RTO is kind of backdoor to go public. But any backdoor has its shady zones, sometimes with thin ice. It
is a certain kind of creative product of corporate lawyers… and we do remember that the state does not
commend creativity, which could damage its interests (the example of cannabis company structuring from
above). Thus, any backdoor can be slammed at any moment.

9. And the United States has had a very bad experience with regard to RTO in the context of Chinese
corporate penetration into the U.S. economy with bad consequences for the latter. Watch “The China
Hustle” to go deep into the issue, and surprise yourself.
The problem of reverse takeover is that the obvious asymmetry of information gives private companies
huge space to commit fraud. And that could damage the market and investors. Thus, the RTO scheme is
more about a “boutique” solution for a small number, but not a “pret-a-porter” tool to go public.
Thus cannabusiness is still facing a huge gap in terms of financial resources to rocket the industry. It must
play under bad terms and conditions (including dilution) if it is lucky to find a risky investor. Sad, but
true.
Hypocrisy
Patent #: 6,630,507
Date: October 7, 2003 (filed: February 2, 2001)
Assignee: The United States of America as represented by the Department of Health and Human Services
Abstract: “Cannabinoids have been found to have antioxidant properties, unrelated to NMDA receptor
antagonism. This new found property makes cannabinoids useful in the treatment and prophylaxis of wide
variety of oxidation associated diseases, such as ischemic, age-related, inflammatory and autoimmune
diseases. The cannabinoids are found to have particular application as neuroprotectants, for example in
limiting neurological damage following ischemic insults, such as stroke and trauma, or in the treatment
of neurodegenerative diseases, such as Alzheimer's disease, Parkinson's disease and HIV dementia.
Nonpsychoactive cannabinoids, such as cannabidoil, are particularly advantageous to use because they
avoid toxicity that is encountered with psychoactive cannabinoids at high doses useful in the method of
the present invention…”
Conclusion
It is a separate topic to explore why cannabis is so objectionable to the state/corporations. But the truth is,
WE are the source of the rules tightening around us.
Politics is the basis for development of all other components, like taxation and banking, which are a
consequence, not a cause. While politics is a tricky thing, but it is really about the people who create it.
Do you know any president who has refused to live in a presidential palace, choosing instead a farmhouse
as the best place to be? Have you heard anything about a president who gives away 90% of his salary to
charity (e.g., leaving $1,250 out of $12,500)? Pepe Mujica, “el presidente más pobre” (the poorest
president), the ex-president of Uruguay, is the leader who put cannabis on legal rails in the country – the
first cannabis-friendly country in the modern world.
A former guerrilla with the Tupamaros, who was imprisoned for 13 years during the military dictatorship
in the 1970s and 1980s. To get a better understanding of this personality, you can listen to his speech at
the U.N. from September 2013. Pepe Mujica urged a return to simplicity, with lives founded on human
relationships, love, friendship, adventure, solidarity, and family instead of lives shackled to the economy
and the market. That is the rhetoric of a leader who is able to accept the real power of cannabis. Most
importantly, he has no hypocrisy.
Long life, 83-year-old cannabis supporter; long life, Mr. Pepe!

10. Politics is a tricky thing and it is about people who create it. Tabaré Vázquez is the current president of
Uruguay. He is a doctor by trade, and considers marijuana to be dangerous (it’s time for hypocrisy). This
directly affects priorities and the government’s attitude regarding cannabis industry development. That is
why only 17 out of 1,000 pharmacies in Uruguay sell cannabis due to pressure from the banks. While
banks are not willing to take cannabis-related business on board because of the risk of international
sanctions.
The United States’ yellow brick road to cannabis legalization is complicated, too. Dark side forces are
operating, both globally and at the local level: for example, Sessions’ “upgrade” (mentioned above) or
the Wells Fargo case about closing a client’s account because of cannabis-related money. The latter is
extremely interesting, because there is no business involved – it is about politics. Wells Fargo, the fourth-
largest bank in the U.S., fired Florida agriculture commissioner candidate Nikki Fried as a client in
August 2018 because… her campaign received donations from “lobbyists from the medical marijuana
industry.” Paranoia at work.
The key, however, is that ice has been broken and the taste of money has reached the state level. The
market is operating despite all challenges, producing billions in taxes which are following the U.S. budget
already. Here is the example of the State of Colorado:
Colorado Marijuana Taxes. Source: Colorado Department of Revenue, Office of Research and Analysis
States are moving toward cannabis legalization, without a doubt. It is a question of when, not if. Still, the
time frame may vary because of the power balance shifting from time to time, in support of or resistant to
cannabis legalization. The good news is that the positively-oriented segment of society is present both
within state bodies (governors and financial regulators) and within the financial sector.
But both need our last-mile support: when choosing a bank to open account (business/private) or a
political party to vote for, or an individual to vote for. And it is not about the federal level only.
For example, California cannabis adherents have been met with decisions by most cities to ban cannabis
shops: less than 20% of cities in California (89 of 482) allow retail shops to sell cannabis for recreational
use (according to the California Cannabis Industry Association), and 82 of Los Angeles County’s 88
cities prohibit retail sales of recreational marijuana (according to Alexa Halloran, an attorney specializing
in cannabis law for the firm Solomon, Saltsman & Jamieson).
The ice has been broken and the financial sector has been starting to explore the cannabis business more
and more, with a steadily positive trend:

11. Depository institutions (by type) providing banking services to marijuana-related businesses (data ending
30 September 2018). Source: Financial Crimes Enforcement Network Report
It is all about money. Banks are starting to take the risk, and not only because of operational fees they are
going to charge. There is tremendous potential in deposits because of banking reserve requirement rules:
each USD $10 deposit turns into USD $9 in loans. Financial “magic” could bring tens of billions into the
U.S. economy, including small and medium-sized business. And that could happen with considerable
correction to the cost of resources in favor of the end user.
There is no way back. The genie is out of the bottle.
Traditional business has been entering the game already. And it is about corporate monsters but not a
regular corporations.
U.S.-listed shares of Canada-based Canopy Growth Corp. (Snoop Dogg Inside) soared almost 30% in
August 2018, after liquor seller Constellation Brands Inc. (Corona beer producer with USD $30 billion
cap) said it will invest USD $4 billion, in the diversified cannabis company. The company with 6 years
old history, strong international network, and USD $13 billion market capitalization (do you remember
Malta? Its GDP 2017 = USD $12,5 billion). The team which seems to be the strongest player in the
industry with sunny present and the future.
So get ready to switch your investments from “lazy” old-days-assets with grown-up value to an
innovative and dynamic alternatives with a pretty “green” valuation on its starting line.
The state. The United States is “squeezed” between two forward-looking, cannabis-friendly countries.
Canada has turned into a financial harbor for States-based companies already, while Mexico is starting to
accelerate its legalization process: the Supreme Court ruled that an absolute ban on the recreational use of
marijuana was unconstitutional, effectively leaving it to lawmakers to regulate consumption of the drug
(October 2018). At least prevailing attitudes toward cannabis have the chance to prevent a wall between
two beautiful nations.
Moreover, China has been secretly turning into a global cannabis industry leader. There are no official
figures (for external use – the Dragon does not like transparency), but evaluation points to 50% of the
worldwide total area which is used to grow hemp. And leadership is not only about production: as of
2017, Chinese companies had 309 out of the 606 patents filed around the world related to cannabis. And
that was before China-Israel cooperation, which is developing just now.
So keeping Substance I status of cannabis means almost no chance to get a piece of pharmaceutical pie as
soon as R&D is too hard to proceed with.

12. The United States is motivated to keep 160,000 people employed:
Number of cannabis business full-time workers. Source: Marijuana Business Daily
The United States is supported by the church. Let’s avoid Bible quotes here, but pay attention to the
Mormons’ real support for cannabis nowadays: Utah, the home state for Mormons, has passed sweeping
changes to a new voter-approved medical-marijuana ballot measure under a planned compromise that has
secured the support of the church.
15 million+ group of people who have a health code that eschews alcoholic beverages (they just use water
to commune), tobacco, coffee, tea, and other addictive substances. They tend to be very family-oriented,
and have strong connections across generations and with extended family. These are values shared by the
cannabis community, for sure.
There are myriad problems that cannabusiness has been facing since the early 1930s. We are struggling,
creating, inventing, and risking, but we are still alive, friends. Cannabis is the litmus paper to demonstrate
society’s maturity and the trend says “guys, you have been getting mature!”
Maturity means we are able to influence the order of things. Due to awareness, due to perseverance, due
to the progress.
Developing means turning the current pseudo-democratic system into its liquid “sister.” This will be a
huge step toward a meritocracy. Ask Singapore about meritocracy: per capita income in 1965 = USD
$500, per capita income in 2015 = USD $55,000 => growth rate = 11 000!
Developing means restructuring the interaction mechanics between each other and between other parties
involved in the process. And the core thing is we are free to contact each other with no intermediary.
Business means interaction of supply and demand. The state and banks are just service providers for us. It
is about third-party involvement.
Legalization and decentralization are made from the same flesh. Decentralization tools and technologies
have just arrived. This is about both the state and business. Someday, we will have the ability to choose a
candidate and recall the vote in a real-time mode via a cryptographically-secured system. Not once every
four years, but according to the real action and results we get from our chosen ones: no results, and there
are missed election program points – bye-bye! Just push the button. With near-zero operational costs. The
responsibilities of the chosen ones will be put on a totally new level.

13. In terms of business, the future is only just arriving. Distributed ledger technologies like blockchain are
completely transforming the financial world: it is now possible to throw payment intermediaries out of
cannabis buy-sell process (find the next article in the cycle to get more)!
Maybe it’s time to make a more dramatic shift and set free the cannabis culture of third parties’
overweight?
Just keep in mind the direct causal link between each action we take and the results we get. It’s not just
about politics or cannabis. We have the government (or town council) we allow to exist. We have the life
we allow to exist.
Assume individual responsibility, and act accordingly.
Peace!
Annual marijuana rally on Parliament Hill in Ottawa, Ontario, 2018. Source: Chris Wattie/Reuters
P.S.
“Make the most you can of the Indian Hemp seed, and sow it everywhere.”
George Washington, farmer, U.S. founding father
please, share. please, act.
Andrew Zaichenko,
Cannabis priest.