Vancouver-based blockchain company Global Compliance Applications Corp. (APP:CSE; FUAPF:OTCQB; 2FA:FSA) has signed an agreement with a South African insurance company to join the country’s growing cannabis industry.
GCAC has entered into a share sale agreement whereby it will purchase 33% of a special purpose vehicle (SPV) with Blue Anchor Risk Solutions (Pty) Ltd. called Blue Anchor 420 SPV (Pty) Ltd.
The global cannabis market is expected to grow from US$25 billion in 2021 to US$150 billion by 2031, a compound annual growth rate of 20.5% between 2022 and 2031, JC Market Research said in a report released this week.
The South African government estimates that the cannabis industry is worth an estimated 28 billion rand (South African currency) which could create between 10,000 and 25,000 jobs.
The South African government estimates that the cannabis industry is worth an estimated 28 billion rand (South African currency) which could create between 10,000 and 25,000 jobs.
A 2018 court ruling decriminalized the private use, possession and cultivation of cannabis there, and President Cyril Ramaphosa said earlier this year that the country should tap into the industry.
“With government policies changing, so is the demand for medical marijuana,” Grand View Research said in a report. “Many countries that have legalized the use of medical marijuana also pave the way for cultivation to cut down on imports and gain revenue in the form of taxes. This in turn has created jobs in the industry and many more companies are operating in this territory.”
Blue Anchor 420 is the only specialist cannabis insurer in South Africa, according to GCAC.
GCAC’s Efixii app and blockchain allow farmers to get feedback from buyers and offer them digital rewards in exchange.
The company has also signed an exclusive dealer agreement with Efixii Africa, a wholly owned subsidiary of Blue Anchor 420 SPV. GCAC will be paid a fee of US$230,000 by Efixii Africa to license the software to local cannabis growers.
For the 33% stake in the SPV, GCAC will pay Blue Anchor CA$200,000 in shares at CA$0.05 per share. These payment shares will be subject to a four-month holding period after the transaction is completed.
The catalyst
Medical marijuana is now legal in 38 US states and the District of Columbia, and cannabis is legal for all adults in 21 states and DC.
Studies show that medical marijuana can be used to treat symptoms of chronic pain, chemotherapy-induced nausea, Parkinson’s, Alzheimer’s and other neurological diseases.
GCAC’s Efixii app enables growers to have direct relationships with end consumers as well as verify the purity of their produce. Via a QR code, the grower can provide stories about their produce that are accessible to anyone with the app and a smartphone – where it was grown, its genetic makeup and feedback from other consumers. The consumer can share their own feedback and get rewards from the grower, such as non-fungible tokens (NFT).
GCAC has also partnered with EMTRI Corp., a leading cannabis marketing and advisory agency that issues electronic money tokens (EMTs) to farmers on GCAC’s blockchain. EMTRI and GCAC announced last week that they had launched EMT trading on Uniswap, providing liquidity to EMT holders.
The program will record these things along the way for South African growers, every step from genetics to planting, from harvest to distribution.
“It’s a better way for them to sell their product to consumers,” said GCAC CEO Brad Moore Streetwise reports.
Markets are opening up as attitudes towards cannabis continue to change. US President Joe Biden recently pardoned thousands of people charged with simple possession of marijuana at the federal level.
And another non-psychoactive substance in hemp, cannabidiol (CBD), is used for skin care, anxiety, seizures and pain management. The CBD market is expected to grow from USD 2.42 billion in 2021 to USD 15.66 billion by 2028, according to a report by The Insight Partners.
Blockchain
The Ethereum blockchain that Efixii works on is an electronic distributed ledger system where no one entity, such as a bank, is in control. Blockchains are best known for their role in cryptocurrency systems, but they can be used for any database – such as agricultural records and customer interactions.
GCAC launched Efixii in 2020 with its own Layer 2 Ethereum blockchain. It has the ability to create NFTs.
Moore believes many everyday electronic items will eventually be consolidated into the blockchain, like all your store rewards programs and the other physical cards you might have in your wallet or dangling from your keychain right now.
For growers and their customers, it will enable them to connect directly, even when there are other intermediaries involved in the transactions.
GCAC has also partnered with EMTRI Corp., a leading cannabis marketing and advisory agency that issues electronic money tokens (EMTs) to farmers on GCAC’s blockchain. EMTRI and GCAC announced last week that they had launched EMT trading on Uniswap, providing liquidity to EMT holders.
“They’re the last ones to receive anything,” EMTRI Executive Director Eric Kennedy said of the farmers during a recent interview with Moore. “They are the first to set everything up. So we really thank them. . . This is something completely new, it has never been done before. This is groundbreaking.”
Ownership and share structure
GCAC’s top shareholders include CFO and director Alexander Helmel with 2.57% or 5.29 million shares, CEO Moore with 2.54% or 5.25 million shares, Hanan Gelbendorf with 0.81% or 1.67 million shares, and director Jeffrey Hayzlett with 0.08 million or 0.08 million shares. .
The company has a market capitalization of CA$5.01 million, with 206.2 million shares outstanding, 193.9 million of which are free float. It is trading in a 52-week range of CA$0.075 and $0.015.
|
Want to be the first to know about interesting Cannabis, Technology and Cryptocurrency / Blockchain investment ideas? Sign up to receive FREE Streetwise Reports’ newsletter. |
Subscribe |
Disclosures:
1) Steve Sobek wrote this article for Streetwise Reports LLC. He or members of his household own securities in the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsorship fees. The above information is for informational purposes only and is not a recommendation to buy or sell securities. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with: Global Compliance Applications Corp. Click here for more information.
3) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional, and any action a reader takes as a result of the information presented herein is his or her own responsibility. By accessing this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation of investment. Streetwise Reports does not provide general or specific investment advice, and the information on Streetwise Reports should not be considered a recommendation to buy or sell securities. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
4) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the website, may have a long or short position in securities mentioned. Board members, managers, employees or members of their immediate family are prohibited from buying and/or selling these securities in the open market or otherwise from the time of the decision to publish an article until three business days after publication of the article. The preceding prohibition does not apply to articles which essentially only reproduce previously published company publications. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities in Global Compliance Applications Corp.a company mentioned in this article. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities in Global Compliance Applications Corp., a company mentioned in this article.
