Hungover. Trying to motivate myself to drive from Colorado Springs to Denver for the second annual Crypto-Cannabis conference. It’s 1 pm.
Chris Derose messages me:
“This conference is weird!”
“Well, there’s a lot of bitcoin pumping, with newbs. And this porn star is getting trashed. Shitfaced.”
“I should be there. I’m headed up.”
“There’s tons of beer, too much beer. And people are taking smoke breaks. It’s not a big crowd.”
Soda water. Cigarettes. And go.
And did they get you to trade your heroes for ghosts?
Hot ashes for trees? Hot air for a cool breeze?
Pink Floyd. Seems fitting as more and more of the bitcoin industry gets co-opted by corporate interests. Even Bitcoin Core developers – Hearn, Grigg, Garzik – are leaving the volunteer work to join startups for the incumbents now.
I’m going as a bitcoin skeptic. No. Not that. Bitcoin is working, although more speculative than a woman without the will to day trade cares for. But it’s working. Blockchain, though… That I’m skeptical about that. I won’t be alone. Derose is vehemently so.
Blockchain isn’t a revolution.
We’re just two lost souls swimming in a fishbowl
Year after year.
Derose and I have both been in the industry long enough to know the rallying cry is a lie, that nearly all these blockchain-based businesses will find the struggles of competing at scale with the incumbents too much. And they’ll move on to a new industry. First finance. Then healthcare. Insurance as well. And then others.
An hour and a half later, I walk into a small space with about 10 people spread out across seven church pews listening to a man talk about the benefits of hemp.
The plan: To smoke a small amount of weed, which would be a large amount of weed for me, and go Gonzo. This isn’t applicable to Gonzo-ing.
A little after 3.30 pm. I sit down next to Derose. This thing is supposed to wrap up at 4.20 both days. Cute. But they’re running late. Probably the smoke breaks, the keg outside and a box full of gallon bottles of hard alcohol in the back room.
There’s one other woman in the room. Pretty standard for a bitcoin conference. Until a thin woman with dreadlocks walks in from the smoking patio.
“That’s the porn star,” Derose whispers to me.
“That doesn’t look like a porn star.”
She doesn’t have huge breasts flopping out of a skin-tight sequins dress? He shrugs.
“And what does cryptocurrency have to do with this new hemp industry?” asks the speaker, Michael Bright, chief financial officer and national sales director at The Hemp Connoisseur (THC) Magazine. “Most of these people can’t get bank accounts. Bitcoin solves all that.”
I haven’t seen it yet.
While bitcoin can be used without interacting with the traditional financial system, many people and businesses won’t use it like that for various reasons and so must follow the rules of the traditional financial system.
One of those reasons is volatility.
Merchants, like legal marijuana dispensaries won’t want to be exposed to bitcoin’s price fluctuations so they’ll use a third-party merchant processor to immediately exchange the bitcoin into cash. And many bitcoin merchant processors aren’t accepting businesses in the gray areas of commerce, like guns and ammo dealers and dispensaries, since that might then cause those service providers to take on quite a bit of risk (risk the bank’s have decided they’re better off not taking) and possibly lose their bank account. As an audience member says, he’s lost around six.
A panel of the morning’s speakers is up next.
But “if you stay in the crypto-space, you stay in that sphere and won’t run into the burdens of regulations and compliance,” said Joseph Ciccolo, founder and president of BitAML, which provides AML compliance help to digital currency startups.
“That could be powerful,” he says after explaining that he’d like to see a more circular economy spread through the cannabis industry with dispensaries paying their suppliers and employees in bitcoin, as well as accepting it from customers.
It could be. Cheaper. Sure. Less overheads. Faster. Yes. Ten-minute transactions too. Although the US is looking to move to a real-time payments system soon. Better. That’s ideological usually.
And while I have no doubt bitcoin will work its scaling problem out, currently there’s still a problem there, especially if another 100,000 dispensaries come online.
So why hasn’t it happened? Same old, same old chicken-and-egg problem.
Most of the small merchants that accept bitcoin don’t see much volume. That can be said about clothing and accessory shops in New York City, casinos in Las Vegas and even medical marijuana dispensaries in Colorado Springs.
In MyCelium community manager, Dmitry Murashchik’s mind, we just need more bitcoin ATMs.
Most bitcoin ATMs don’t get much volume either, which is why – as one audience member…