Issue #235

Banks won’t do business with legal marijuana sellers—enter PotCoin

So far 20 states and the District of Columbia have legalized the use of marijuana for medical or recreational purposes, but with the rise of the legal pot business has come a wave of robberies and other crimes targeting pot dispensaries and their owners. The purveyors of legal pot are a major crime magnet, in part because they largely operate on a cash-only basis. That’s because most banks and credit card firms refuse to work with these businesses for fear of being prosecuted under federal law, where the sale of pot remains illegal. Last month, the Obama administration issued new guidelines aimed at making banks feel more at ease in providing services to legal marijuana businesses. But the administration stopped short of promising immunity, so for now most financial firms are steering clear. That leaves many potrepreneurs to handle large amounts of cash—and fearful for their safety. “Everyone in the industry is having nightmares,” Michael Elliot, executive director of the Marijuana Industry Group, recently told NBC. So perhaps it’s fitting then that the idea forPotCoin—a new digital currency, akin to bitcoin, that’s being marketed to legal marijuana businesses—came to “MrJones” in a dream. Mother Jones, 3-26-14.