Two months ago Bitcoin.com reported on the State of Washington giving marijuana dispensaries approval to accept bitcoin for cannabis sales. Now, thanks to a fintech startup called Posabit, a few cannabis merchants in Seattle are utilizing the decentralized currency in their business operations.
Also read: AML-Compliant Bitcoin Payments Coming to 56,000+ Merchants Globally
Seattle Cannabis Dispensaries are Accepting Bitcoin for Marijuana Sales
Many cryptocurrency enthusiasts would love to see the Bitcoin industry join together with the growing marijuana movement, which is happening in a few U.S. states. The State of Washington has allowed medical and recreational marijuana sales since 2014. Just recently, Washington lawmakers and the state’s Liquor and Cannabis Board gave marijuana merchants and payment processors the approval to utilize digital currencies for dispensary sales.
Since then the startup Posabit, a credit-card-to-bitcoin payment processor, has begun working with four Seattle dispensaries which sell marijuana. The pot shops working with the Posabit system include the Queen Anne Cannabis Company, Herb’s House, Greener Today, and three Uncle Ike’s locations. Posabit claims to give cannabis merchants and other brick and mortar stores an easier way to accept credit cards and bitcoin at any point of sale location. Furthermore, the company says using their digital processor reduces cash transactions, which can be a danger for cannabis dispensary employees.
Bitcoin Taking the Friction out of Cannabis and Credit Card Laws
The Posabit experience allows users to purchase bitcoins with a credit card and use them to purchase goods from a cannabis location with a Posabit kiosk. In essence, the startup says that they remove the issues of using credit cards for pot sales by utilizing a legal cryptocurrency, because cannabis credit card sales are prohibited by law.
“We are selling bitcoin to [individual] customers, and allow our [pot store] customers to accept bitcoin as payment,” co-founder Ryan Hamlin tells Seattle Weekly. “Obviously federal laws prohibit using credit cards to purchase cannabis,” Hamlin adds. “That’s exactly what we’re not doing.”
Three Types of Posabit Merchants
Another benefit to the Posabit system is that the business is fully compliant with KYC, AML, and OFAC regulatory guidelines, explains the startup. Additionally, Posabit details its real-time transaction history provides a transparent reporting system for auditing. The startup believes that there are a few types of merchants that could use the Posabit infrastructure at point of sale locations. The three types of businesses that may benefit from Posabit’s bitcoin payment system include:
Cash only merchants who want to accept another form of payment. Tech-Savvy merchants who want to promote the use of bitcoin to differentiate themselves from the competition and micro-merchants who want to benefit from lower transaction costs by accepting bitcoin for small purchases.
Removing the Dangers of Cash Transactions With Software
There have been many Bitcoin proponents trying to push for these two industries to join hands, and it seems like the idea may continue to prosper. One of the biggest concerns for merchants in states where marijuana is legal is the large amounts of cash being stored onsite and transported offsite to banks. This type of practice opens the dispensary to dangers such as being robbed and other forms of cash losses. Posabit’s co-founder says that he saw “an industry that was in dire need of a credit solution.”
Hamlin adds, “I said, ‘software has got to be able to solve this problem.’”
What do you think about Posabit and Seattle cannabis dispensaries accepting bitcoin for reefer sales? Let us know what you think in the comments below.
Images via the Posabit website, Queen Anne Cannabis Company, Herb’s House, Greener Today, Uncle Ike’s, and Pixabay.
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