Cannabis Wealth spoke to co-founder of the CBX Stock Exchange, Jonas Duclos, about the evolution of the platform and its mission to provide clarity for producers in a market with limited or no regulations.
The CBX Stock Exchange was launched earlier this year in a bid to provide transparency and quality assurance in the European cannabis market. The commodities platform, launched by cannabis patient, Jonas Duclos, and co-founder, Kevin Goetelen, has evolved from its previous iteration – HempBroker420.
CBX Stock Exchange enables trading in flowers, hemp biomass, distillates and isolates and tinctures, as well as allowing producers to connect with a number of different industries, such as wellness and beauty.
Duclos began his journey in cannabis after managing the excruciating pain of a rare genetic condition – PRP – for over 20 years before discovering that cannabis provided him with the most effective pain relief. This revelation led Duclos to dedicate his time to studying the plant.
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Developing a trading platform
Duclos had been working in wealth management when, in 2016, his health problems led him to leave his job. He found CBD flowers provided great benefits, and quickly became an expert in what was, at the time, a relatively new product.
“I almost instantly became an expert because most people had no idea what it was. I had quite a precise idea of what we were dealing with and how we could work with it,” said Duclos. “So, I left the bank and started the brand CBD420. I wanted to make something that was trustworthy. It was very important to directly implement a lot of testing and making sure that we have good quality product.”
Duclos says it was the first brand to distribute CBD products outside of Switzerland across Europe in 2017, which was met with a high demand from businesses, leading to the formation of HempBroker420. The aim of the platform was to introduce buyers and sellers, and receive a commission. The site gathered around 2000 companies and generated more than €3m (~£2.58m) of trade in the first 18 months.
“Very early on I was able to build a good reputation. Before HempBroker420 I was really focusing on CBD – branding and marketing CBD products. I spent a year working with the HempBroker420 customers identifying all their their needs and problems, and that’s when I had the idea of creating CBX Stock Exchange,” he said.
Duclos says that one of the inspirations for the exchange – which he built from scratch – is the Chicago Commodities Exchange, which standardises products such as corn or coffee so they can be tradable on a global scale.
“We have companies in more than 90 countries,” he said. “It is definitely proof of a growing global market – prohibition is behind us now – knowing when regulation will be introduced is a gigantic question mark, and the industry has a lot to do show they are reliable and trustworthy.
“We have producers and distribution that’s growing steadily all over Europe now, but it could be much better and that’s because of the trust factor. The industry is difficult to navigate and that’s where I’m hoping to bring a little bit of guidance.”
With the UK slowly moving to be the first regulated CBD market in the world, Duclos emphasises the current lack of control in the cannabis market means there is a need for product quality assurance for consumer safety.
Transparency in the European market
In order to provide transparency through the platform, the CBD Stock Exchange has a registration process for which companies must provide detailed information and documentation that is reviewed by the platform’s compliance officers. To do this, CBX consulted the Swiss Health Authority and developed its own standards.
Achieving CBX Certification level and a Certificate of Analysis (COA) label on the platform ensures businesses can demonstrate that they work with labs to carry out safety analyses, showing that products do not contain contaminants such as heavy metals and pesticides.
“CBX becomes an amazing tool to be a transparent platform where everybody can showcase their product,” said Duclos. “Businesses can work to improve their rating by providing all the documentation.
“For a seller, it gives a lot of tools to find more buyers by getting better ratings, and for the end user, indirectly, we are forcing people to test more. We’re forcing people to get certifications that can be used to build trust with the end user.
“There is a big need at the moment for the industry to be more legitimate, to make more sales, to orient trades better and to find the right buyer. The platform is basically a melting point for the whole industry because we’re working with seed producers, flowers, biomass, all the extractions and then all the tinctures.”
The COA can be obtained by members independently or through CBX’s exclusive partner, SciTec Research laboratory based in Lausanne, Switzerland. The certificates are accredited by the Swiss Accreditation Service and Swiss Testing Labs, and SciTec specialises in the analysis of cannabis and derivatives, with each product undergoing seven quality control checks.
Duclos commented: “Businesses can show how good their product really is. They can increase the price of their product per kilo – there are so many things that they can benefit from in the long run.”
The exchange is now in the process of raising €1.7m in funds and is implementing a direct shipping service for every trader. Duclos is also embracing innovation through the digitisation of the exchange’s shares on the blockchain – enabling anyone to buy.
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