Why Pot Stocks Are High on the Metaverse
Virtual Head Shop
As the digital landscape known as the metaverse grows, cannabis companies are exploring different ways they can benefit. Some have established virtual stores to boost brand awareness, while selling merchandise and nonfungible tokens (NFTs).
This past December, Higher Life CBD Dispensary LLC partnered with Saucey Farms & Extracts LLC to take over the second floor of a store in Voxels, which is a metaverse-like platform. Close to a thousand people visit daily. There’s no direct sale capability, but virtual cash registers are located inside the store where people can access links to purchase the two companies’ products.
Given the newness of Web3 and blockchain technology, as well as its decentralized nature, regulatory standards are somewhat unclear. In this sense, cannabis companies may see unique upside in the metaverse. For example, Meta Platform’s (FB) Facebook is somewhat strict about the promotion of marijuana and its derivatives, while the virtual world offers more flexibility at present.
That said, the metaverse is not a completely lawless space when it comes to the sale and marketing of cannabis. Roblox Corp. (RBLX) prohibits users from “discussing, depicting, or promotion” of all activities that are illegal or highly-regulated. Blockchain gaming platform The Sandbox has similar rules, while Meta’s Horizon Worlds platform explicitly forbids any content depicting marijuana. Dencentraland and Voxels note they’re willing to work with cannabis companies.
Saucey Farms says while it hasn’t sold much product through its virtual cash register in Voxels, the expectation is that will change as the metaverse itself grows in popularity. Co-founder Alex Todd predicts the company will be able to sell cannabis in the metaverse within five years.
In the meantime, one of Saucey’s main areas of focus is NFTs. The company is excited about the ability to offer branded clothes and accessories for people’s virtual characters, which has the potential to boost brand awareness. Legalization of recreational marijuana is a relatively modern concept in and of itself, and it seems the brand-new metaverse could offer cannabis companies plenty of upside.
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