Cryptocurrency and Cannabis Home Delivery: Made for Each Other?
Card-carrying cannabis users in Utah are subject to some of the strictest medical cannabis laws in the country. For example, state law only allows for fifteen cannabis dispensaries throughout the entire state, much of which is rural in nature. The recent development of home delivery is helping things, but even that is not without its issues. Enter cryptocurrency. It could be the solution to one of home delivery’s biggest problems.
Home delivery is not limited to medical-only states. Marijuana dispensaries in recreational-use states are also getting into delivery. There are even third-party companies now popping up to provide the marijuana equivalent of services like Grubhub and Instacart. Yet they all have one thing in common: a serious lack of payment options.
As long as marijuana remains illegal under federal law, companies that do business in the cannabis space will struggle to find banking services. Many of them will continue to operate cash-only businesses. The cash-only model does not work well for home delivery. Cryptocurrency could be the solution.
- Escaping the Banking System
The whole point of cryptocurrency, when Bitcoin creator Satoshi Nakamoto first got things started, was to create an alternative financial system free from the influence of the banking sector. Nakamoto created Bitcoin as a completely independent platform free from any centralized control and government influence. Bitcoin’s results speak for themselves.
When a consumer conducts a transaction using cryptocurrency, that transaction completely escapes the banking system. There are no banks involved. Transactions occur either directly between two parties or through a payment provider who takes payment from the buyer and forwards it to the seller.
The beauty of the system is that government has no control over cryptocurrency transactions. As things currently stand, Washington could shut down a bank providing services to the marijuana business. Federal regulators can do so because they have authority over the banking system. They do not have authority over cryptocurrency. Moreover, crypto isn’t controlled by a single entity. Therefore, there is no institution to shut down.
- Ordering Online with Crypto
Utahmarijuana.org says that one of the barriers to medical marijuana home delivery in Utah is the payment problem. Though there are companies now just getting into the delivery business, none of them are all that happy with the idea of drivers carrying around large amounts of cash. They are having to come up with workarounds.
Cryptocurrency is one solution for streamlining both online ordering and home delivery. If a dispensary were willing to accept cryptocurrency payments, their patients could order and pay online. Delivery drivers could make their deliveries without having to collect payments at the same time. That takes cash completely out of the equation.
- How It Could Work
Bringing crypto to the marijuana space could be done in several ways. Companies could accept payments through standard platforms like Bitcoin and Litecoin. Alternatively, there are small number of dedicated cannabis tokens created specifically for the marijuana industry.
Regardless of the particular crypto chosen, patients would buy coins with U.S. dollars on a crypto exchange. Companies would sign on with a payment processor capable of guaranteeing an immediate crypto-to-U.S. dollar conversion. When a customer buys with crypto, the payment processor keeps the tokens but sends the equivalent in U.S. dollars to the seller. Everyone wins.
Cryptocurrency offers a lot of advantages including decentralization and freedom from the banking system. Marijuana home delivery’s advantages include convenience and not having to drive long distances to a dispensary. When you think about it, the two seem to be perfect for one another. Do not be surprised to see them becoming more closely integrated.