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TOKN White Paper

TOKN is a cryptographic token created on the Ethereum blockchain, using the ERC-20 standard protocol.

TOKN stands for Transactions On Kannabis Network.  It is also a pun on the common usage “tokin”.  This is one way to evince the proposal for connecting TOKN to the worldwide trade in cannabis.

There is no central exchange market for cannabis. Despite that, marijuana legalization and trading in cannabis is spreading rapidly. This White Paper explains an idea to develop a decentralized peer-to-peer cannabis exchange marketplace powered by TOKN, an Ethereum smart contract.  The contracts to be traded on the exchange would be blockchain contracts based on the ERC-721 protocol, aka NonFungibleTokens (NFT or “nifty” contracts.)  This paper proposes that the fungible TOKN acts as the medium of exchange that powers the underlying blockchain for the NFT cannabis contracts.

Think of this proposed exchange as an Amazon or a Chicago Mercantile Exchange for marijuana, but without the heavy-handed regulation of the latter and the personal invasiveness of the former.  A peer-to-peer online market using blockchain technology in the form of smart contracts can provide price discovery and delivery reliability for cannabis contracts of all sizes.

Currently, the legal cannabis trade is typically carried out in two different kinds of markets.  The first type is between large licensed growers selling in bulk to distributors who in turn sell wholesale to dispensaries.  In some jurisdictions, the entire transaction is a vertical operation, where the grower, the distributor and the dispensary are all operating under the same corporate umbrella.  Other jurisdictions require separate cultivation and distribution entities. The second type of trade is between small growers with artisanal cannabis product.  Often, these smaller growers sell to one or only a few retail outlets directly rather than through distributors.  Describing these two types of transactions begins to reveal the many challenges in the legal cannabis market that TOKN can help solve.

  1. The first challenge is the lack of standardization. Much like wine grapes, there are many different strains of cannabis, all having different characteristics ranging from flavor and scent to medicinal and psychoactive effects.  A commodity exchange typically relies on standardization of product to create a small number of contracts that can be traded in bulk—in the wheat market for instance, there are a six standard varieties of wheat traded via spot and futures contracts in fixed quantities of 5000 bushels. Obviously, with a multitude of cannabis strains, standardization for the purpose of creating contracts is difficult.
  2. The second challenge is the confusion arising from licensing and testing standards in each separate jurisdiction. In the US, most states have a cannabis regulatory authority with taxing and testing requirements, all operating under the ludicrous and unenforced Federal marijuana prohibition.  Similar problems afflict almost all countries where cannabis is legal.  One simple consequence is that for all practical purposes, it is not possible to legally trade or transport cannabis across state or national borders.
  3. The third major challenge is the inability of small growers to sell their product to a larger group of buyers. Many smaller growers are producing very high quality artisanal cannabis that could justify a higher retail price, but the small grower lacks a marketplace with larger buyers who can distribute the product more widely.
  4. The fourth major challenge is the lack of price discovery mechanisms. Without price discovery, growers cannot know what to charge for their product and how much of which product to grow.  This is especially problematic for larger growers, who need pricing information to plan a cultivation plan that may cost many thousands of dollars to implement.  Without a market that provides price discovery through futures contracts and spot pricing, the grower is left with no guidance.  Similarly, without price discovery mechanisms, the wholesaler or retailer is also left without a way to plan how much to buy and at what price to sell.
  5. The fifth challenge is one that occurs in many supply chains but is particularly acute in the cannabis market. Basically, how does the buyer (and ultimately the consumer) verify the quality of the product?  Even though most jurisdictions require laboratory testing of cannabis for the cannabinoid content of a batch, that is not a guarantee that the quality has remained stable since the testing.  Lab testing also does not provide any information on the flavor and psychoactive characteristics of a particular strain.  Information about product quality can be inferred from the seed genetics, from the grower reputation, from the cultivation cycle and even from the plant color and odor.  But most of that information is unverifiable by the buyer or consumer at present.

The result of all these challenges is a fragmented market that provides inferior product at exorbitant prices.  Many legal cannabis growers and sellers are going out of business as a result, while the black market for cannabis continues to flourish.  Despite a huge demand for legal cannabis, despite a growing number of legal cannabis jurisdictions, and despite intense interest in the stock market and among venture capitalists, most publicly traded cannabis companies are barely surviving and cannabis growers large and small are suffering from a glut of product.

How could TOKN work in the cannabis market?

A hypothetical scenario for buyer, distributor and seller explains the underlying concepts better.

In this example, MaryJane Farmer grows Purple SuperWeed from seed that she buys from a reputable seed geneticist.  She grows the plants indoors, with controlled humidity and temperature.  When the buds are harvested she dries and packages the product in 10kg sealed packages.  She then creates an ERC-721 contract in a standard and user-friendly format.  The contract contains her grower’s license number, the available information about the seed, photos of the plant buds, the lab testing report and a detailed description of the cultivation technique and dates. It would also contain her offer to sell with proposed price (in TOKN), quantity and delivery details.  MaryJane’s contract is automatically displayed on the TOKN network.  Because this is a blockchain network, MaryJane also has to pay a small transaction fee (in TOKN) to power the network’s computer nodes which include her time-stamped NFT contract in the blockchain.

BigBud Buyer is looking for Purple SuperWeed to sell to his group of retailers. He spots MaryJane’s contract offer, and offers to buy her product at a somewhat lower price than her asking price.  He enters the bid details in the TOKN network.  The network of computers operates automatically to match bids and offers on contracts, using the Automated Market Maker mechanism already operating in DeFi networks like Uniswap.

MaryJane likes BigBud’s bid price for her product and accepts his offer on the network.  In making the acceptance, MaryJane’s initial ERC-721 NFT contract is modified to indicate the agreed price (in TOKN) and the delivery details of the product to BigBud. Modification of the contract also means paying a small transaction fee to include the newly-edited contract in the blockchain. BigBud deposits his payment (in TOKN) on the blockchain, along with the transaction fee. At this point, a taxing authority could also automatically collect a tax on the transaction which would also become part of the blockchain data.

During delivery, each person handling the product enters their identifying information and important conditions of the delivery. For this product, it might be details about which company is delivering, their handler’s license, the date of pickup and delivery and perhaps the environmental conditions.  This is similar to a signature-verified FedEx delivery of delicate pharmaceuticals.  The 10kg packages themselves are identified with RFID tags or with QR labels containing the information on how to view the contract details.

Once BigBud has received the packages and verified receipt on the TOKN network, the contract price (in TOKN) is delivered to MaryJane.

BigBud replicates this process by splitting the original ERC-721 contracts into multiple smaller “clone” contracts, each representing the portion he is selling to his retailers, together with his asking price for the smaller quantities.

BigBud’s retailers tell him that customers love the Purple SuperWeed and especially like knowing before they buy that they are buying exactly what they are paying for: a high-quality special product with a verifiable provenance.  The retailers are asking BigBud for more of MaryJane’s Purple SuperWeed.

BigBud wants to secure a future supply of Purple SuperWeed.  He offers multiple big contracts on the blockchain for delivery at a future date payable now at a discounted price.  MaryJane accepts a couple of the contracts and uses the payment (in TOKN) to buy more seed and supplies, setting up her growing plan for the next batch of Purple SuperWeed.  MaryJane’s friends hear about her success, look at the blockchain and see that they can also grow and sell Purple SuperWeed to Big Bud, since MaryJane could only handle a few of the contracts from BigBud.  Her friends do what she did and use the TOKN payment on the futures contracts to buy their seed (from MaryJane) and set up their own cultivation plans.

Everybody sees the pricing and transaction ddetails.  Customers know they are getting what they paid for.  Even the taxman likes the market, because a (tiny) part of each TOKN transaction goes to pay the state’s cannabis tax automatically.

This white paper is only a proposal.

TOKN is currently live and tradable on the Uniswap exchange.  The initial liquidity pool and thus the initial price is set at 1 million TOKN per ETH.  At a recent approximate value of ETH = $2400, each TOKN potentially represents 2.4 * 10^3/10^-6=$0.0024.

Because TOKN is not fully liquid and trading, any calculation of potential value is meaningless at this point.  TOKN will not likely have any value before it is actively trading and fully liquid.

Because this blockchain token, like any other project or token on the blockchain, is highly speculative, anyone expecting to use TOKN in any way must be prepared for total loss of any investment.  TOKN value depends on the multiple unpredictable factors, such as the state of legality of marijuana in the US and elsewhere, the general agricultural conditions affecting cannabis and the eventual development of a decentralized blockchain marketplace for spot and futures cannabis contracts.  Such a marketplace does not now exist.

Multiple experienced individuals and entities have tried to create a similar marketplace in cannabis and other products.  To date, and to the best knowledge of the authors of this whitepaper, all such projects using the blockchain to undergird a logistics operation have been unsuccessful.  Thus, the proposed use of TOKN to provide value to cannabis trading may be completely without merit.

At initial creation, TOKN has a fixed amount of 1 quadrillion tokens.  No further TOKN can be created; thus, when fully distributed TOKN is anti-inflationary.  During this initial project phase, TOKN is available directly from the creator’s treasury at a significant discount to the liquidity pool.  The expiration of this discount offer will depend on the success of the initial project phase in developing a base of holders of TOKN.

How to obtain TOKN.

You can purchase a small amount of TOKN directly on the Uniswap exchange, using ETH or another common crypto token.  You can also purchase TOKN from the creator treasury at a discount to the established liquidity pool price (approximately 1 million TOKN per ETH.)

In order to transact TOKN, you will need an Ethereum-connected wallet.  We recommend using Metamask (metamask.io), because it is free and relatively simple to set up.  Make sure to save all passwords and seed words in a secure location, together with your private key and public key.

When you have opened Uniswap (uniswap.org), you will be asked to connect your wallet.  The Uniswap exchange does not provide custody for tokens. Connect your wallet to the Ethereum Mainnet (at the top of Metamask.)

Because TOKN is brand-new, you cannot find it on Uniswap using its symbol.  For the same reason, it does not have a stated value on Uniswap.  To find TOKN on Etherscan.io or on Uniswap.org, enter the contract address:


To obtain TOKN from the creator treasury at a discount from the stated amount in the liquidity pool, send a deposit of at least 0.08 ETH to the creator wallet address:


  For 0.08 ETH, you will receive 100 thousand TOKN back to your wallet.  If you want to communicate with us in advance of sending the ETH, please email to MaryJane@420Beginner.com or whatsapp/text to +1-801-860-8274.

You will obtain treasury TOKN at a 20% discount to the initial approximately 1 million per ETH.  In other words, for 0.8 ETH, you will receive the same 1 million TOKN as if you were to buy on Uniswap for 1 ETH.

The same creator wallet address can also accept WrappedBTC (WBTC), Tether (USDT), BNB Token (BNB), Uni token (UNI), USDCoin (USDC) and many other tokens on the Ethereum chain.  If you prefer to use one of these tokens, the value in TOKN will be calculated at the same discounted rate as for ETH using the most recent US dollar value from Etherscan.io.




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