Mega Chill has become the first medical marijuana dispensary in Canada to accept bitcoin.
Since the formal announcement this September, Mega Chill has seen an overwhelmingly positive response from the community, both from patients familiar with bitcoin and customers who had never heard of the digital currency.
The relationship between bitcoin and the marijuana industry is long-standing due to bitcoin’s ability to offer an alternative to the traditional banking system and its still-prevalent use in online dark markets.
In the case of Mega Chill, however, the decision had less to do with sidestepping potential money problems and more to do with the growing popularity of bitcoin as a payment method. CoinDesk spoke with co-owner Matt Jung, who cited the public’s curiosity and enthusiasm for digital currency as the reason his business decided to accept bitcoin.
Jung said customers have begun using bitcoin regularly since Mega Chill started accepting it, telling CoinDesk:
“It’s been really good for our patients. One girl who comes in gets paid in bitcoin, so it’s perfect for her.”
Notably, the company manages its own bitcoin wallet rather than using a payments processor.
Ideal bitcoin merchant
For some, Mega Chill represents the ideal merchant for bitcoin – a business that is a relative newcomer to the technology but still sees the benefits of accepting it.
Jung told CoinDesk that Mega Chill, like other small businesses, is responding to grassroots support for the technology. He added his belief that bitcoin is an easy-to-use payment method and that the public ledger makes record-keeping simple as well.
“It’s an interesting new step to take – a new emerging technology. It’s always good to have another payment method, to have more options for everybody.”
He added that from a financial management standpoint, bitcoin has helped reduced some of the friction Mega Chill faces as a marijuana business, including the hurdles it experienced when dealing with either card issuers or banking institutions.
“It eliminates a lot of the complications of dealing with the banks and dealing with the credit card companies,” Jung said.
Marijuana and digital currency
Some observers have pointed to bitcoin as potential boon for businesses in the marijuana space. Several altcoins exist, like potcoin and cannabiscoin, that seek to apply block chain technology to a marijuana-specific digital currency.
In some ways, the regulatory environment for bitcoin mirrors the situation currently facing the marijuana industry. Some of the associated risks and challenges, including restricted access to banking partners and a regulatory framework subject to change by federal regulators, are shared by both communities.
Still, US-based bitcoin merchant processors have been reluctant to support the marijuana industry. BitPay, for example, will not work with any of the industry’s merchants given that the drug is illegal under federal law.
Ultimately, it may be business-by-business integrations like Mega Chill’s that help bitcoin proliferate in an industry in need of financial tools. Beyond the dispensary, the co-owners of Mega Chill plan on accepting bitcoin at the pizzeria next door, Mega ILL Pizzeria, once it reopens for business later this year.