As Congress Weighs Weed-Friendly Banking, California Eyes Crypto-Payments for Cannabis

It’s been a rollercoaster ride for California dispensaries as they’ve navigated numerous changes since legalization went into effect. But one thing that hasn’t changed is the cash-only status of most cannabis shops that can’t accept electronic card payments because banks still refuse to do business with them.

State lawmakers are not giving up on the issue. SB 930 died in the Assembly Appropriations Committee last year, but state Sen. Bob Hertzberg (D-Van Nuys) recently revived it as SB 51, which would basically mirror SB 930 and create a framework so private banks or credit unions could issue checks to dispensaries for paying taxes, rent and other business expenses. Dispensaries could also buy state and local bonds to help earn interest on their deposits.

Running a cash-only business can be a serious inconvenience. Even the state seems to agree. Last year, former California Treasurer John Chiang said the statute “stalemate” was making cannabis businesses “targets for violent crimes and putting the general public in danger” by forcing them to handle large quantities of cash.

Chiang also noted that it “created a nightmare for state and local government revenue-collecting agencies.” The California Department of Tax and Fee Administration does not accept cash payment unless an exemption is requested. One concentrates manufacturer said he has to schedule an in-person appointment to pay Uncle Sam.

The federal ganja ban has made most banks reject dispensaries as customers, but the Blue Wave on Capitol Hill is working to make Congress 420-friendly. Change at the federal level is crucial to enacting any meaningful reform since the Treasurer’s Office estimated that a state-backed cannabis bank would cost around $35 million to start and it’s unlikely that it would be approved by the feds.

Luckily, Congress last month introduced HR 1595, which aims to create protections for banks working with legit marijuana businesses.

But whether the Democrats’ bill makes it through the GOP-controlled Senate is another story, so the Golden State continues to pursue other solutions.

In a move befitting tech-saturated San Francisco, Assemblyman Phil Ting introduced a bill last month that would let pot shops at least pay their city and county taxes in cryptocurrency. Some California dispensaries and other marijuana businesses are already on board and using cryptocurrencies like Litecoin, Paragon, PotCoin, CannaCoin and PayQwick, so the practice isn’t unheard of, even though it’s not common yet.

Silicon Valley dispensaries haven’t kept pace with these developments, ironically, but that’s not to say some haven’t tried. Several years ago, Harborside on North 10th Street reportedly dabbled in (or at least considered) using the CanPay app, which uses a closed-loop system of banks already doing business with the weed world.

Now, however, all San Jose dispensaries only take hard cash or charge merchant fees that are higher than their customers.


  1. > Last year, former California Treasurer John Chiang said the statute “stalemate” was making cannabis businesses “targets for violent crimes and putting the general public in danger” by forcing them to handle large quantities of cash.

    Not to mention the scientifically documented heath, medical, psychological, and social problems linked to marijuana that ALSO puts the general public in danger.

    Doesn’t John Chiang know? The willful stupidity of the drug proselytizers is a source of never-ending amusement.

    Campaign contributions from Big Marijuana definitely CAN lower your IQ.

    • I am pro cannabis for medical purposes. It is true cannabis can provide a better standard of living for some clients with severe and chronic diagnosis suck us HIV and children living with severe autism. These severe cases typically present with intense aggression that endangers the child and his/her caregivers…However, what is happening in California is not medicinal marijuana; it is a legal marijuana business highly unregulated. It has made lots of people rich at the expense of communities’ physical and mental health. It is unreasonable that buying marijuana is easier than buying cough medicine. I know minors go to these places and one way or another they mannage to buy marijuana products. Just because a substance is legal, it does not mean this substance is safe. Alcohol and tabacco are legal; they cause serious health conditions. Medicinal marijuana should be purchased at a local pharmacies and people ask to show ID just like with the cough medine. While research on cannabis may be limited, people’s and particularly youth vocational and social life are significant affected by cannabis use. Their substance use starts with marijuana and it keeps scalating. This is a typical pattern of teens’ substance use, Marijuana, alchohol, Xanax, acid, Molly, meth, cocaine, heroine…School drop ups and incarceration history are part of this drug use pattern. SAY NO TO SUBSTANCE USE. Do not allow these industries to make business at you expense. Go out, exercise, volunteer clean you city,…!

      • > I am pro cannabis for medical purposes.

        FEXXY there is an entire federal agency his purpose is regulating drugs, testing them for SAFETY and EFFICACY, and approving them for sale. It is the FOOD AND DRUG ADMINISTRATION.

        There is a LEGAL pathway for LEGAL sale of the therapeutically beneficial agents in marijuana.

        WHY doesn’t Big Marijuana use this LEGAL process INSTEAD of dumping massive amounts of campaign money on politicians who will approve the sale of crap that they don’t know anything about.

        Here’s a homework assignment: WHY did Congress pass the Food Safety Act in the first place?

        Hint: Elixir sulfanilamide

  2. > The federal ganja ban has made most banks
    > reject dispensaries as customers, but the Blue
    > Wave on Capitol Hill is working to make
    > Congress 420-friendly.

    Ha, I love that kind of writing! And keeping going Sen. Bob Hertzberg! We do need to normalize the industry since it’s obvious: Cannabis is here to stay. Just like the scare mongers, I guess.

    • Wow SCC what a fool you are! Should we normalize the porn industry including the child porn industry since it appears they are here to stay? Think about this, even high profile people engage in child porn use and human trafficking, should we normalize that? Medicinal marijuana is different that marijuana dispensaries business purposes. Become a friend with a aliant and take a one way trip to Jupiter. There are only two types of drugs, legal and illegal. It does not make sense to me we buy all legal drugs at a pharmacy and marijuana at privately own dispensaries!

      • Hey FEX, if I’m the fool, you are the extremist. Why go there with your extreme example? I think these are two entirely different things.

        • Hey SCC, I am not an extremist; I am a FEXXNIST! Legalizing Marijuana in this manner makes no sense. Medical doctors use drugs such as Morphine and the like drugs to support patients during physical illness and treatment. Other opiates and legal drugs are prescribed to patients to improve their conditions, Strattera and Ritalin for children with autism for example. Again, there are only two types of drugs legal and illegal. Medical doctors and psychiatrics prescribed and monitored these drugs and treatment related to their use. It would make sense that the same doctors would prescribed cannabis based medication and monitored their use and need based on the medical necessity criteria. This 420 it a false pretense created by people wanting to make quick money while paying little or no taxes. Both legal and non-legal medication have side effects, damage to the liver and other vital organs. They also affect the neuro-transmitters of the brain, health and function. For this, the experts, have to be in control of prescribing and monitoring their use. The Marijuana dispensaries are a big scam supported by politicians and want to be politicians like yourself! SAME ON YOU FOR CONTRIBUTING TO SOCIETAL PROBLEMS AND HARMING THE HEALTH AND FUNCTIONING OF OUR YOUTHS! Go to Jupiter A$$…OL!

  3. What a quandary, how do we dope people up, get our bucks and drive society into the toilet? Keep using drugs idiots and expire on the street cause you have no reason to live. To bad you kill other people’s children.

    • > Keep using drugs idiots and expire on the street cause you have no reason to live. To bad you kill other people’s children.

      This is where I think Libertarians go off the rails.

      In a true libertarian society, people would have to accept the reality of hopeless drug wretches lying in the gutter, puking all over themselves, and then dying like dogs. “Well, it’s their own damn fault. They made the choice to do drugs”.

      Unfortunately, America is not that type of society and does have the basic instincts to help TRULY UNFORTUNATE people.

      Also, too many drug addictions are NOT the consequences of bad choices, but the exploitation of stupid or naive people, IN MANY CASES children.

      San Jose’s marijuana laws are simply enabling exploiters to take advantage of stupid, naive, or compromised people.

      Cannabis advocates acknowledge that marijuana causes “dependency” (i.e. “addiction”) in “ONLY” nine or ten percent of users. ONLY?

      Great! San Jose’s greed for tax revenue is such that it will allow businesses that KNOWINGLY create dependency for the products that generate the taxes.

      • I totally agree on your last three points Bubble. Only 10% of peoples’ lives that we are going to send to the toilet due to Marijuana dispensary greedy owners and the politicians seeing a way to keep financing their political aspirations. Now, for the state it costs about $10, 000 per month per one bed for drug use treatment. These people are most often youths. This is treatment we pay with our taxes. Thus, these politicians we vote into office advocate for these marijuana dispensaries to keep poisoning our youths. Then, we have to pay the bill for the harm they cause. The financial cost is minimal to the humanitarian cost. These children’s overall health, physical and mental, and their vocational aspirations are severely harmed by these addictions. SHAME ON THE MARIJUANA DISPENSARIES AND INDUSTRY. It is our responsibility to protect children, seniors, and other vulnerable populations from these political vulture!

    • Funny you mention that. This is exactly what the Sackler family is doing with their *legal* drugs via their company Purdue Pharma. They got lots of people in the US addicted to their opiates and have been leaving a trail of forty thousand deaths a year from it. All the while, they knew this was happening but didn’t care because they were raking in billions. Do an internet search on news about David Sackler or Purdue Pharma. It’s pretty ugly what they’ve been doing.

      My take is that this is a bit more of a problem than cannabis, from which it is impossible to overdose or even develop a physical dependency, unlike opiates or even alcohol.

      • WOW SCC, I can tell you are getting a big bite out of this marijuana dispensary business. Good job on advocating; your arguments are not creative (boring) and unsupported though. It is well known the pharma industry make money to0 and their main purpose is to medicate as much people as possible. This is not on debate. Thus, this is the same model the Marijuana dispensaries advocated and won, and now used. MAKE IT LEGAL BY BUYING POLITICIANS’ SUPPORT. The helping profession is also in decline particularly on the non-profit sector. We truly need ethical and professionals providers to protect communities from these “legitimate” industries.

    • Totally M.T.Bomb. Some people criticize undocumented workers for “taking” our resources. They are paying attention to the wrong source! Undocumented immigrants in its majority work long-hours in jobs the rest of us would not take or wish to take. They pay rent and taxes every time they make purchases like the rest of us. A good portion of them do not know they qualify for services because of their status. There is no social security benefits for them when they are no longer able to work. Then we have the white collar people of our society that know how to cheat the system, pay minimal or no taxes, they even afford the advocacy and support of politicians we voted in. We have those who buy their immigration and citizenship status into the country and they get jobs local college graduates do not have access to. How many people who graduated from SJSU work for google or other high tech companies? These are the people that really learn to take others’ resources at a big time scale with the advocacy and support of our politicians. Our local politicians do not care about the community only about their policial gain and own economic. WE MUST START PAYING ATTENTION TO THE REAL SOURCE OF CORRUPTION ANF FIGHT IT! Whatever it takes! RECALL ROSEN, Liccardo, Córtese, Chavez, and the rest!

  4. Jack, this illegal substance, cannabis, industry is a total rip off for our society, any society. Speaking of California, we have some politicians advocating for these dispensaries where our youths can have easy access to the substance. Believe me, some of those youths come from families that have already fallen into substance addiction. Thus, their children are placed in foster care or other placements. Others are just like any other next door kid. Drug addiction does not discriminate; thus all levels of SES community members can become addicted. We see this on the news all the time regular people, politicians, actors, so on. For those with private insurance their plans will cover these expensive treatment. For those with MediCal, the state pays for it. And it should pay for it since we are not stopping these politicians and private dispensaries from the harm and sometimes deaths of our communities. It is a nonsense rational. We create a problem, so that we later pay big time money to correct it. All this due to paying attention to self-serving politicians. As I have stated, medicinal marijuana is different. I have seen kids who do not eat due to lack of appetite because of severe/chronic conditions. After using monitored use of cannabis, mostly in the form of food, they gain weight and conditions improve. There are other good examples for the justification of medicinal marijuana. Children with cancer receive other dangerous drugs during treatment which is necessary to help them. These dispensaries are just an industry. Young girls are typically introduce to marijuana use by adult males that end up Commercially Sexually Exploiting them. These youths are not idiots; they are just easy prey for these big time criminals. Again, medicinal marijuana should be purchase at a pharmacy after providing prescription of a actual doctor. The Marijuana Dispensaries are just a scam. They have lots of money so they can buy the advocacy of politicians at the local and state level. WE SHOULD PAY ATTENTION TO HOW OUR LOCAL POLITICIANS VOTE ON THIS.

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