Global Cannabis Capital, a fund that invests in Latin American cannabis companies, is planning to raise funds to expand with the sale of security tokens to private investors.
As Cannabis users around the world light up to celebrate 420, a different campaign to help future investment in the industry is gathering momentum with crypto tokens.
GCC is planning to raise more capital with crypto tokens rather than the traditional offering of shares, as reported on Bloomberg on April 18.
The reports stated that the company is about to sell tokens on the Ethereum blockchain. Unlike most cryptocurrencies, the tokens in these offerings are backed by the assets or equity of the issuer.
This token offering could set a new precedent for other cannabis companies, particularly those based in countries with limitations on banks supporting marijuana-related businesses (MRBs).
“The tokenization route provided us a significantly more efficient option than the traditional IPO process. Both in terms of time and costs. The cannabis industry will grow exponentially over the next year, so from our perspective timing is everything.” said Chief Executive Officer Andres Israel to CryptoSlate.
He continued saying,
“With tokenization, we can reach thousands of investors in a short period of time. And that has always been our objective, to provide as many investors as we can with a vehicle that represents the cannabis industry”
The tokens are also designed to allow investors to expand their portfolios into a growing number of start-ups within the industry.
“With our token investors can now own equity participation of a growing number of startups, and propel the growth of the cannabis industry (since 100% of the proceeds are used for investing in more cannabis companies which will generate an increase in the portfolio valuation),” says Isreal.
With the offering, GCC intends to issue capital stock in the form of 100,000 tokens, through which the fund will likely sell up to 6%…
