California Politician Pioneers Cryptocurrency for Cannabis Purchases

A Groundbreaking Transaction

In a remarkable twist in the saga of cannabis legalization and crypto adoption, Berkeley City Councilmember Ben Bartlett has taken a daring step by becoming the first elected official in the United States to purchase cannabis using cryptocurrency. The purchase, made at Ohana Cannabis dispensary in Emeryville, California, featured the innovative use of Bitcoin Cash (BCH) and the stablecoin Universal Dollar (UPUSD), marking a historic moment in both the cannabis and cryptocurrency worlds.

The Demonstration That Made Waves

This bold transaction took place during a live demonstration of crypto-financial technology coordinated by Cred, a pioneering blockchain company, alongside the Blockchain Advocacy Coalition. This group is dedicated to developing transparent blockchain legislation, aiming to streamline and legitimize cryptocurrency use in business operations.

Understanding the Transaction

During the event, local officials were introduced to the mechanics of blockchain and stablecoin transactions. Ohana used Cred’s LBA token to facilitate the sale, with the city tax and sales proceeds settled in Universal Dollar, a stablecoin anchored to the US dollar and operating on the Ethereum blockchain. This method not only streamlined the payment process but also promises greater transparency for tax collection.

Revolutionizing Cannabis Tax Collection

As discussed in the accompanying press release, this initiative is aligned with the Blockchain Advocacy Coalition’s support for a new bill (AB 953) that would allow California to accept cannabis tax payments via stablecoins. Councilmember Bartlett highlighted the bill’s significance, as 70% of California’s cannabis operations remain unbanked, leading to increased risks and transaction costs.

Key Benefits of Crypto Transactions

• Cost reduction for consumers and merchants
• Enhanced transparency in tax collection
• Increased predictability for state and local governments

The Future of Cannabis and Cryptocurrency

Dan Schatt, co-founder of Cred, expressed optimism regarding the integration of cryptocurrencies into everyday transactions, stating, “Not only does crypto result in significant cost reduction for consumers and merchants, but it also enables highly productive tax collection, transparency, and predictability for city and state governments.” This sentiment resonates strongly, especially in light of the rapidly evolving cannabis market.

What’s Next?

Following this innovative event, Councilmember Bartlett has requested Berkeley City staff to draft a report on the implementation of stablecoin technology for cannabis tax acceptance. In a state where cash transactions dominate the cannabis industry, such initiatives could pave the way for a modernized approach to not only cannabis sales but also tax collection.

A Look Back

California is not stepping into unknown territory; back in 2018, Ohio gained attention for being an early adopter of Bitcoin for tax payments. Although many states have contemplated similar measures, California is leading the charge, hinting at an exciting future where cannabis and cryptocurrencies might harmoniously coexist.