Even as federal and state regulators struggle over state cannabis legalization, there are key areas in which they align.
Each cares about safety, compliance, and depriving criminal cartels of revenue. And, more than ever, tech firms have the potential to bridge the gap between legalizing states and prohibitionist federal policy.
Lost in much of the renewed current debate about prohibition has been the substantial regulatory regimes that 29 states and the District of Columbia have established to ensure cannabis is grown and sold safely and securely.
As founder and leader of a software company that helps dispensaries to, among other things, automatically comply with local regulations in their operations, I know there is no “wild west” in the legal marijuana business. Growers, distributors, and retailers must comply with complex regulations that require accounting for every milligram – literally from seed to sale. While the rules differ from state to state across the country, every state has taken its oversight role seriously.
This has had two major effects.
First, we uniformly find reliable, efficient markets developing as the cannabis business matures. This is no small feat given the federal prohibition. For one thing, cannabis supply in any given state must come from in-state growing operations because growers cannot transport cannabis across state lines. For another, marijuana is an all-cash business. Credit card companies and federally chartered banks do not do business with cannabis companies for the same reason.
Second, through just our own business, which operates in 12 states, we have seen billions of dollars in revenue tracked, accounted for, and effectively taken from organized crime and put into state coffers. Drug cartels have surely lost entire markets in states that have legalized marijuana. Whatever you think of legalizing cannabis, there is no arguing that…