The Chicago-based Ceres company wants to build a cannabis seed-to-sale transaction network on the blockchain using its U.S. dollar-supported stablecoin - if the security of digital sales is approved by the U.S. Securities and Exchange Commission (SEC).
A new payment network
Launched in 2017 by West Point graduates and former U.S. soldiers Greg Anderson and Charlie Uchill, Ceres recently filed a document with the SEC to conduct a Reg. A sale, in order to obtain a permit to sell both tokens and coins.
The token would represent an equity stake in the company, but the firm plans to use the coins as an effective transaction tool in its payment network. The company is preparing to sell up to $ 30 million of its tokens and $ 20 million in Ceres coins.
In addition to its plans to build a payment network, Ceres is also active as a credit institution for a legal cannabis business, although Urchill, the company's chief operating officer, said that the company has not yet issued any loans and relies on the sale of digital securities to raise capital.
The company documents filed with the SEC also point out that token holders, as a group, will be entitled to receive 80% of the company's net revenues from their lending business and 20% of the net revenues from the enabled payment system. to the blockchain.
Ceres' proposals
As for the transaction network proposed by the company for the legal industrialization of cannabis, Ceres' filing states that its blockchain-based network would improve transparency and help comply with anti-money laundering and fraud regulations.
But the success of the blockchain network will also depend largely on manufacturers, Investors and consumers who are moving towards its landline. Urchill said that the only cases where dollars should be used, according to the company's model, are where consumers pay Ceres to get their currency and when the company pays loans to producers.
All other transactions between consumers, dispensaries and producers will take place in the company's currency. According to the company's SEC filing, upon approval, Ceres will target its marketing and sales efforts primarily in the states of Illinois and Washington, where the company "identified some strategic business opportunities" related to its payment network, coins and tokens.
Washington was the first U.S. state to legalize recreational use of marijuana in 2012 and Illinois legalized it last January. The company also noted that there is currently no trading platform available to sell its tokens. Alternatively, the company suggests that it could conduct the sale on its website.
Pending SEC approval for its securities, Ceres hopes to capitalize on the growing legal marijuana industry in the United States, whose size was estimated at $ 13,6 billion in 2019, according to an Investopedia report.
