please dont do this on our blockchain. the last thing i want is the feds breathing down my neck. the code is open source go fork it and make SilkRoadCoin.
but in answer to your question, technically, yes, a blockchain could be used to solve these problems. not asset exchange though. thats not what asset exchange is for. its for trading homogeneous resources not heterogeneous resources. "weed" for example is heterogeneous so weed colored tokens wouldn't work well in the asset exchange. what you want to do is outline a protocol for interpreting arbitrary messages in a way that is relevant to running a marketplace not an asset exchange.
I think you are wrong here, Anon.
Suppose I'm a weed dealer called Mr. Green. Suppose I get 10 oz. of product in from my supplier. I can issue an asset called "1 oz Mr. Green's Dank Bud" and issue 10 shares of the asset.
Dealers develop reputations for quality of their product, so 1 oz. from Mr Green may be worth less than 1 oz from Mr. Purple, but as far as a buyer is concerned...an ounce from Mr. Green is fungible with any other ounce from Mr. Green.
And not for nothing, but Bitcoin would probably never have gotten out of Mom's basement if it weren't for the appearance of the Silk Road early on in Bitcoin's history.
You're probably right that there are more elegant ways to run such a marketplace, but to say it couldn't be done in the AE is being shortsighted, IMO.
I could be wrong.