Marijuana has a major banking problem

Marijuana has a major banking problem

Marijuana is going legal all over the place, with some analysts saying that as many as 35 states are set to go legal in the next few years, in addition to the states that are already legal (Colorado, Nevada, and Oregon are leading the charge, and California is set to offer recreational weed in just about a month, on January 1). This all means that marijuana is quickly becoming big business, except for just one problem: There's nowhere to store all of the money. 

The projections for California are crazy: $5.2 billion next year, and that's just the guess. The issue is that because weed is still scheduled as an illegal drug by the federal government, banks are unwilling to take money from any dispensary or producer. The rules say that any bank taking money from a marijuana-related business needs to register with the Treasury Department's Financial Crimes Enforcement network, and no banks are willing to do that. This leaves the marijuana business out in the cold: dispensaries are full of cash that could attract criminals or encourage federal raids (that could lose everything), or other places turn to cryptocurrencies or even money laundering to keep their stockpile safe, and both of those solutions come with an additional set of risks. With all the money being made selling legal marijuana, there's a growing problem of just where to store it all.

The Motley Fool also points out that the federal government has broken its promise: The Obama Administration had promised to relax some regulations on researching marijuana (with the eventual goal of removing its status as an illegal drug). The current administration, however, led by the backwards Attorney General Jeff Sessions ("I thought [the KKK] was ok until I learned they smoked pot"), has rolled back the amount of weed research done by the federal government, and continued to make things harder for marijuana producers and sellers. 

Something will have to give here at some point: Either legalization will have to be shut down by the federal government (as they crush the voice of the people, who are clearly in support of legality), or the banks will have to find some way to take and manage the incoming flood of money. Legality is definitely important but if marijuana producers and dispensaries are left without the support they need to properly handle their money and their businesses, then things could be just as problematic as keeping the drug prohibited in the first place.

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