LGC Capital Ltd.
Symbol: TSX-V: LG
- LGC is implementing a strategy to create a new workable and transparent global cannabis supply chain platform.
- The platform will be aimed at enabling a global transparent payment record for cannabis product, supply and payment.
- The goal is to provide a new efficient platform that can be used for regulatory compliance purposes with government entities, give assurance to consumers on product sourcing and quality, and offer an efficient and compliant payment infrastructure for producers and retailers.
- LGC is planning to use blockchain technology to provide a reliable and global supply chain register and smart contract framework, and to use Internet of Things ("IOT") technologies to track physical product across the supply chain.
MONTREAL, Jan. 16, 2018 /CNW Telbec/ - LGC Capital Ltd. (TSXV: LG) ("LGC") is pleased to announce that it is launching a new subsidiary company to specifically engage in the development of an efficient global marketplace technology platform designed to help producers, value-added processors and retailers in selling, and consumers in accessing, cannabis product. LGC will focus on providing a traceable and verifiable platform, thereby enabling producers to have an efficient payment mechanism that replaces current ad hoc cash-based payments and that will be fully compliant with all relevant jurisdictional regulations.
The platform will utilize the latest blockchain technologies to create a reliable and verifiable purchase and payment system and use Internet of Things ("IOT") technologies to track cannabis product shipments so as to provide assurance to consumers regarding the sourcing and quality of products.
John McMullen, CEO of LGC states, "LGC is rapidly growing its legal cannabis footprint around the world with each country having its own regulatory framework, transparency and banking challenges that all need addressing as the industry expands and matures. We at LGC recognize these growing business demands, not only for our own operations, but also for other sector participants. We intend to launch a unique and "industry-specific" blockchain / IOT technology platform intended to address the specific needs of many cannabis operators. We will engage with a number of European institutional and technology groups that are highly experienced and knowledgeable in this space and will actively seek institutional co-investments in this venture prior to launching it."
LGC Global Cannabis Marketplace Platform Initiative
As a fast-growing globally focused investment company with expertise in the cannabis supply chain, LGC is well placed to combine its capital resources and expertise in order to develop a global e-commerce framework to support the legal cannabis industry and to ensure it is integrated with the global banking system in a manner that is compliant with international and local regulations.
Many global technology companies as well as niche IOT and blockchain companies are advancing technology solutions to address the challenges outlined above. LGC intends to engage with industry and technology stakeholders to develop and deliver a global industry solution through a combination of its partnerships and access to capital.
LGC will work to develop an open-sourced framework-based distributed ledger, smart contracts and IOT designed to provide a business framework and supporting technology stack that can be used by producers, value-added processors, retailers and consumers in the cannabis sector.
Over the short to medium term, LGC intends to release a whitepaper for industry comment. This whitepaper will seek global consensus within the cannabis industry. In parallel, LGC intends to establish technology partnerships with key blockchain and IOT companies and systems integrators to implement the recommendations of the whitepaper when industry consensus has been achieved.
Global Marketplace Platform for Cannabis Consumers and Producers
As the cannabis industry moves from a niche and often prohibited industry to a more globally accepted and approved regulated industry, it faces a number of challenges that it will need to overcome in order to achieve broad adoption:
- Payment companies are providing limited payment capabilities, often requiring the legal cannabis supply chain to resort to cash-based transactions.
- The lack of a convenient payment infrastructure limits consumer and retailer adoption.
- Many global banking institutions are disinclined to support cannabis-related companies, thereby limiting them in raising growth capital and causing significant audit and regulatory issues.
- Lack of reliable accounting and transaction recording due to the cash nature of the business can lead to "bad actors" engaging in the legal cannabis market.
- Lack of appropriate e-commerce infrastructure limits advertising and consumption and thus market growth potential.
- Lack of clear physical tracking capabilities and transparent and reliable records significantly limits consumer confidence in product sourcing and quality.
LGC intends to use blockchain and IOT technologies in order to create a global marketplace platform that will provide a state-of-the-art multi-channel (web, tablet, voice and smartphone based) e-commerce framework designed to assist producers, value-added processors, retailers and consumers in addressing the challenges described above.
Role of Blockchain
Blockchain, Smart Contract and Distributed Ledger Technologies such as Ethereum are transforming many industries and payment systems. Stakeholders increasingly realize the efficiencies and cost effectiveness of blockchain in areas like supply chain management. The use of a common and transparent ledger will provide a tool for them to quickly see the benefits of greater visibility, which in turn will lead to superior reconciliation, auditability and regulatory compliance.
Consumers would gain greater assurance of provenance and traceability of products. Non-compliant products can therefore be quickly identified in terms of source, quality, delivery process and history.
Role of IOT
IOT is gaining rapid mainstream adoption. Sensor technology is becoming exponentially less expensive so that sensors can be widely deployed in all cannabis product packages. In addition, the roll-out of global IOT networks enables efficient global tracking of both high-value and low-value shipments. When combined with a global distributed ledger, the basis for verifiable product governance and adherence to government regulations becomes substantially more viable.
LGC's involvement in the establishment of a global cannabis blockchain platform will be subject to the approval of the TSX Venture Exchange, to the extent applicable.
About LGC (http://www.lgc-capital.com)
LGC Capital Ltd. is a Canadian incorporated public company listed on the TSX Venture Exchange (TSXV: LG). LGC's objective is to become a diversified business group with core business divisions that provide shareholders with exposure to a diverse range of businesses, products and services.
This press release may contain forward-looking statements with respect to LGC Capital Ltd. ("LGC") and its operations, strategy, investments, financial performance and condition. These statements generally can be identified by use of forward-looking words such as "may", "will", "expect", "estimate", "anticipate", "intends", "believe" or "continue" or the negative thereof or similar variations. The actual results and performance of LGC could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Some important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, government regulation and the factors described under "Risk Factors and Risk Management" in LGC's Management's Discussion and Analysis for the fiscal year ended September 30, 2016, as filed on SEDAR (www.sedar.com). The cautionary statements qualify all forward-looking statements attributable to LGC and persons acting on its behalf. Unless otherwise stated, all forward-looking statements speak only as of the date of this press release and LGC does not have any obligation to update such statements, except to the extent required by applicable securities laws.
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SOURCE LGC Capital Ltd
For further information: John McMullen, Chief Executive Officer, Tel.: (416) 803-0698, Email: John@lgc-capital.com; London contact: Anthony Samaha, Chief Financial Officer, Tel.: +44 (0) 20 7440 0640; Investor Relations: Dave Burwell, The Howard Group Inc., Tel.: (403) 221-9015, Toll Free: 1-888-221-0915, Email: email@example.com