Anonymous Payment Methods
4 min

The Best Anonymous Payment Methods

4 min
News Zamnesia

Cryptocurrency is increasingly viewed as the payment method of choice for both cannabis users and psychonauts. It is secure, anonymous, and almost as cheap as cash.

One of the unfortunate aspects of “cannabis reform,” which is still far from baked, is cannabis banking. The drug war is still raging when it comes to financial laws - particularly in the United States. This means that, for the most part, cannabis cannot be paid for in anything but cash. Private payment networks in the U.S. (including PayPal) and all credit cards forbid such sales, both domestically and overseas. This means that it is still hard to buy pot or psychedelics on plastic just about everywhere.

Where it is possible, you still leave a record of the transaction.

For that reason, many in the cannabis and psychonaut communities have begun examining how cryptocurrency can be used in every aspect of the industry. This starts with online payment, but it does not end there.


The idea of using bitcoin or altcoins in this industry has been around for some time. In fact, almost as long as there has been cryptocurrency. The now notorious Silk Road got its start connecting bitcoin holders to those who wanted to sell drugs. It has repeatedly been raided and shut down at this point. But the basic idea is as popular as ever.

In fact, certain parts of the industry, such as those in California, are examining how to integrate this concept even further. Why? The recreational market is truly taking off this year. And federal law still prohibits canna-banking, even if the industry is legal statewide. In Europe, where seed companies are frequently targeted by the major credit card networks, this is an even more intriguing option.


What Is Cryptocurrency?

It sounds very complicated, but it is actually pretty easy to understand. Using blockchain technology (which is kind of like the internet of databases), programmers can create new kinds of money. These currencies can be used to buy anything, as long as the merchant accepts them. It is a digital form of cash.

Unlike traditional money, which is controlled by central governments and banks, cryptocurrency is a form of monetary exchange that is completely separate from this infrastructure. Coins are created via “mining” - or the solving of complex problems. Once in circulation, they can also be spent just like regular old cash. In fact, this is becoming increasingly simple.

The technology is more stable and accepted. There are many industries that now accept cyber currency, bitcoin in particular. There are also starting to be companies who are experimenting with cryptocurrency-only strategies. For example, right now in London, high-end real estate brokers are offering mansions - but only for bitcoin.

If you can do it with real estate, you can certainly do it with cannabis.


How Does Cryptocurrency Work?

On one level, cryptocurrency works just like regular money. Users open digital wallets on a blockchain system. They can send and receive cyber currency - a lot like online banking. However, no bank oversees such transactions. Instead, all transactions between parties are recorded in the blockchain.

This way, when Bob sends Sue five bitcoins, she will know that she got paid, and from Bob, specifically. The advantage of this interchange is that only Sue and Bob will know they have had any contact. In other words, while the transaction itself is recorded, the parties transacting are kept carefully anonymous. That is one of the biggest reasons so many in the canna-community are looking at cyber currency as the perfect alt-payment method.


Why Would You Use Cryptocurrency?

There are many uses for cryptocurrency. The original idea was to create a decentralised payment system that was completely anonymous. Bitcoin has already become popular as a way of sending money across national borders at almost no cost. The idea of anonymous purchase is a powerful one. However, there are many other advantages.

• Anonymity: You can send money to anyone in the world if you both have the same cryptocurrency wallets. Nobody knows but you who you send money to, and for what reason.

• Access to global markets: You can buy anything as long as the vendor also accepts the same cryptocurrency that you have.

• Cheaper processing fees: The whole point of cyber currency in the first place was to cut out the expensive middleman banks. When buying from a cybercoin-accepting merchant, the transaction should be frictionless. And almost free. Remember, you still have to buy the cyber currency in the first place with regular cash.

• It is secure: Unlike cash or checks, cryptocurrency is much like “mobile banking” with regular currency. The established cryptocurrencies are now considered secure. Your wallet can still get hacked, of course. And if someone finds out your private key (the cryptographic protection installed to help secure the system), they can spend your money. But apart from that, the established cryptocurrency networks are secure.


Cannabis Culture’s Own Cryptocurrency?

Given all the excitement about alt-payment possibilities, many cannapreneurs with tech skills are looking to cryptocurrency as a way to solve their banking problems. There are several projects already underway that are trying to establish a special digital currency for the cannabis community. The best known one, at this point, is Potcoin. However, there are others.

The problem so far is community unity. Signing up for a specific kind of pot-associated cryptocurrency means that everyone in the value chain has to sign on. It means that all growers, distributors, dispensaries, and of course, customers have to buy in. And so far, that is far from a reality.

Why buy a limited cyber currency for just one product when you can use a regular one? That said, there are other experiments going on right now in the payment space that are considering the use of both cryptocurrency and its underlying technology in this market. Not all of them use cyber cash, but rather a form of digital token. Before investing in a specialised form of cyber currency, in other words, consider the non-branded alternatives.


The Most Popular Cryptocurrencies

There are many cryptocurrencies available today. And while their ranking is changing on a daily basis, here are the top four based on market cap.

1. Bitcoin: Bitcoin is the original cryptocurrency and the one that is most widely-used and accepted. Miners can create bitcoins by solving complex problems. They can then use the coin as they would money. However, you do not have to mine your bitcoin to use it. Today, you can buy bitcoins with cash. Most people buy bitcoins in U.S. dollars, yuan, and euro. We love Bitcoin, so, naturally, Zamnesia supports Bitcoin transactions as well.

2. Ethereum: Ethereum is technically a cryptocurrency, but the idea was never just to use it as “money.” In fact, the Ethereum blockchain was envisioned as a machine-to-machine interaction system. That said, it is very easy to create altcoins using Ethereum. People who hold ether can use it as money. But many of them use this blockchain technology for other purposes. Namely, smart contracts.

3. Ripple: While many people outside the cryptocurrency community have never heard of this, it is the third most popular cyber currency by market cap in 2017. Ripple was originally developed by banks to make cross-border transactions cheaper. Today, it is starting to be used by major financial institutions to lower the cost of financial processing in general.

4. Litecoin: Until last year, litecoin was the third-most-popular alt-currency. It has been rapidly overtaken by Ripple. It may also lose market position to Dash.


Why Should Stoners Think About Cryptocurrency?

There are many applications of this technology in the cannabis space. The most immediate is being able to make purchases online. Particularly for those who buy cannabis seeds.

The benefits are huge. Processing is fast, payment is anonymous, and cryptocurrency itself is becoming more accepted by this business community. Setting up an account (or wallet) is super-easy and fast. And nobody but you and the seller will have any idea what you purchased.


Written by: Zamnesia
Zamnesia has spent years honing its products, ranges, and knowledge of all things psychedelic. Driven by the spirit of Zammi, Zamnesia strives to bring you accurate, factual, and informative content.

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