![]() Or they can embrace it and try to analyze the risk and try and understand these novelties that are bought by this new industry." It could either harm a bank as an industry, it could harm banking because they don't know how to deal with it and it forces law abiding citizens to work in a quasi-illegal state. Cannabis, in my opinion, could do one of two things. It's very difficult to reconcile every penny of every transaction and for a financial institution to know their client, know their customer well enough to have 100 percent certainty that every single penny came from a lawful transaction. "So now you have these businesses that operate predominantly in cash. "If you are going to keep these individuals out of banking, they're forced to operate in cash and if they're forced to operate in cash they're a lot more high risk," Zarrad said. ![]() Lamine Zarrad is a former bank regulator and now the CEO of Tokken, a startup that's hoping to give cannabis companies a way to track their transactions as closely as they track their plants, by recording those transactions using blockchain technology. Now, small banks in Colorado are starting to work with the cannabis industry, but that doesn't solve every problem. It means that we're hiring armed guards, we're keeping money in safes, and we're paying people with guns to sit there and watch it. It might sound like a fun reality show to have lots and lots and lots of cash around, but in reality, it's not fun at all. ![]() "We had 14 accounts shut down in a couple year period and at one point ended up with no bank account at all. "Until about 18 months ago, it was really iffy as to whether or not you could have a bank account," Cullen said. One Epic Road Trip Leading Up To Election Day The system exists because banks are wary of working with an industry that's still technically illegal at the federal level. "Consumers are not allowed to use their debit cards or credit cards to purchase marijuana," Cullen said. In fact, the entire industry deals primarily in cash, which is harder to track. Since 2013, Colorado has used this system to track millions of plants to ensure cannabis companies follow the law.īack at Cullen's dispensary, consumers have to pay in cash. The tags are part of a state tracking system called Metrc. SEE MORE: Marijuana Arrests Outnumbered Violent Crime Arrests In 2015 And so every plant has a tag on it, and it's these bar codes that are updated for anything that's watered in or sprayed onto these plants." They have bar codes and tracking information on them, and they're registered to this company. On these plants there are blue tags that are recreational plants and there are yellow tags that are medical. Tim Cullen is CEO of Colorado Harvest Company, and he showed us around his facility.Ĭullen said: "As you look at these plants here in front of us, you see that there are different colored tags. ![]() Because it's still illegal at the federal level, they face different barriers than your average small business.įrom the very beginning of the growing process, Colorado cannabis plants are highly regulated. A handful of states are considering making recreational marijuana legal, and the businesses already doing that in Colorado could be examples for others.
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