Category: Marijuana News

Square’s exit from the hemp and CBD market is putting retailers on the clock. With some hemp-focused businesses being told their accounts will close on November 5, 2026, retailers already navigating major federal regulatory changes now face another urgent challenge: finding POS and payment partners they can count on to keep their businesses running.

Cova Software, a cannabis retail technology platform, remains committed to compliant hemp, CBD, and cannabis retailers as other providers step away. Purpose-built for regulated retail, Cova helps businesses navigate evolving federal and state rules, stay operational, and adapt with confidence.

A Broader Signal for the Industry

Square’s exit is not necessarily a sign that other processors will follow. But it highlights a structural risk for retailers who rely on general-purpose technology and payment providers: those companies were not built for regulated retail, and they can choose to step back from a category when the regulatory picture shifts.

For hemp and CBD retailers, that risk is now immediate. For cannabis retailers more broadly, it’s a familiar pattern. Regulated categories require providers that are willing to stay and adapt as rules change, not just process transactions while the rules align with their current model.

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A Michigan cannabis company has announced plans to suspend operations at five of its nine dispensaries, tying the decision to the state’s 24% wholesale tax on cannabis products. Higher Love Cannabis Co. indicated that August 9 was the last day of business at its Upper Peninsula retail operations in Crystal Falls, Escanaba, Houghton, Munising, and Ontonagon. 

In a press release, Higher Love called the 24% tax “another substantial cost in a market already subject to a 10% retail excise tax and 6% sales tax.” 

“While these taxes apply at different stages of the supply chain and do not constitute a single combined tax rate, their collective impact has created an increasingly unsustainable operating environment – particularly for compliant businesses serving smaller and rural communities.” — Higher Love in a press release 

The company said its retail businesses in Ironwood, Marquette, Menominee, and Norway would remain open.  

“This decision comes amid broader pressure across Michigan’s cannabis industry, where oversupply, price compression and declining revenue have already forced numerous businesses to consolidate, suspend operations facilities and eliminate jobs,” the company said. “The added tax burden has further strained the supply chain and made it increasingly difficult for responsible operators to remain viable.” 

A bill proposed in the state in

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Medical cannabis imports in Germany increased from 8,143 kilograms (17,952 pounds) in the first quarter of 2024 to 50,539 kg (111,419 pounds) during the first quarter of this year, making the nation Europe’s largest regulated cannabis market, the Financial Times reports. The sixfold increase comes after the 2024 reforms, which allowed adults to possess and privately cultivate cannabis, and expanded the medical cannabis regime. 

According to research outlined by FT, more than half of cannabis consumers in Germany obtain their cannabis from outside the medical cannabis system, with 35.2% of cannabis obtained from the “social supply,” with at-home cultivation representing the second largest source of cannabis at 21%. A recent study from the University of Hamburg found that more than 200 tons of cannabis were available in Germany last year, including 2.6 tons produced domestically. 

Cannabis intelligence firm Prohibition Partners estimates Germany’s cannabis market totals $997 million.  

Jakob Manthey, the scientist behind the two-year evaluation, told FT that “the illegal market is shrinking although overall consumption has barely changed,” but producers “exploit regulatory gaps and market products that are not evidence-based at all.” 

The health ministry under the current government led by Chancellor Friedrich Martz has submitted a bill to tighten controls on medical cannabis. Debate on that bill is expected in the fall.   

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The Albuquerque, New Mexico-based U.S. Eagle Federal Credit Union announced last week plans to close its cannabis banking arm, the Albuquerque Journal reports. The company said the closure of the Aery Group, which launched in 2019, is due to increased competition among financial services providers as the cannabis industry has grown. 

In an interview with the Journal, Michael Moore, president and CEO of U.S. Eagle, said that servicing the cannabis industry is not part of the company’s long-term strategy and that growing the service was “difficult…without going out of state or into other markets.” 

“We’re not trying to shut the door permanently at all. Definitely not a ‘no,’ but a time-will-tell approach.” — Moore, to the Journal 

Damien Padilla, owner of consulting firm Cannabis Driven Management, told the Journal that there are at least 19 financial services providers in New Mexico now working with cannabis businesses.  

Padilla said that the increased competition is “just one of those things that comes with every market.” 

The Aery Group was one of the first New Mexico financial institutions to serve the state’s cannabis businesses. The closure is set to take effect November 1.  

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The New Mexico cannabis industry is facing a six-day blackout of its inventory system starting August 25, KOAT reports.

The blackout period is thanks to the state transitioning to its new inventory platform, the New Mexico Seed-to-Sale System. The Cannabis Control Division first told licensees about the changes in June, and said the timeline is “aggressive” because the contract for the state’s current inventory system, BioTrack, is expiring.

During the six-day transition period, businesses will be unable to move product between growers, manufacturers, and retailers. Some cannabis companies are worried that the blackout could lead to interruptions for their business, while retailers are stocking up in advance since they will be left with only their existing inventories during the transition.

Others worry the blackout could last longer than expected if unforeseen issues with the new system arise.

Meanwhile, New Mexico recently surpassed $2.35 billion in total combined medical and adult-use cannabis sales.

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Four hemp product retailers in Texas filed a new lawsuit last week claiming that the state’s recent hemp rule changes, which have wiped out most hemp-derived THC sales in the state, are a regulatory overreach that led to over 36,000 lost jobs and caused billions in losses, The Texas Tribune reports.

Set by the Texas Department of State Health Services, the rules took effect on August 1, prohibiting the sale of all hemp-derived THC except for delta-9 THC, which is only allowed in products with a dry weight THC content of less than 0.3%.

The lawsuit, filed in the U.S. District Court for the Western District of Texas on Wednesday, also claims that the rules created a monopoly on THC products for the state’s medical cannabis program.

“Thousands of small business owners built enterprises, hired workers, and invested capital relying on that law. DSHS does not have the constitutional authority to rewrite statutes or destroy an industry simply because it disagrees with legislative policy.” — David K. Sergei, attorney for the plaintiffs, in a statement

The plaintiffs argue that the state’s regulations are superseded by the 2018 Farm Bill, which federally legalized hemp and hemp-derived products.

The lawsuit

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New Mexico cannabis retailers have surpassed $2.35 billion in total recorded sales as of June 2026, the El Paso Times reports.

The total includes over $1.7 billion in adult-use and almost $643 million in medical sales. While Albuquerque generates the most sales as the state’s largest city, the cities and towns along New Mexico’s border with Texas, where cannabis remains prohibited, are generating a high level of sales disproportionate to their population, according to data from the state Cannabis Reporting Online Portal (CROP) outlined in the report.

For example, the city of Sunland Park, which lies directly across the border from El Paso, Texas, has the second-highest rate of cannabis sales in the state, having generated over $204 million in cannabis sales over the last four years.

The state launched its medical cannabis program in April 2022 and its adult-use market in April 2024.

Meanwhile, Albuquerque officials last year launched a three-year pilot program for guaranteed basic income, funded in part by cannabis tax revenues.

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Illinois officials have proposed changing the state’s cannabis cultivation rules in a major policy reversal to allow for outdoor grows, the Chicago Tribune reports.

Under the proposed rule change, outdoor cannabis flower would only be allowed to be used for extraction purposes — cannabis flower products would remain indoor-only.

Previously, the Illinois Department of Agriculture said the state’s requirement that cannabis needs to be grown in an “enclosed, locked” facility prohibited outdoor cultivation. But the agency is changing its tune following multiple legal challenges from licensed cultivators.

The new rule would allow licensed operators to grow outside of their existing facilities, although outdoor crops would need to be sectioned off with a chain-link fence and additional security measures.

Scott Redman, founder of the Illinois Independent Craft Growers Association, told the Tribune that the change would be a “game changer” for small growers.

“For those operating, it allows a faster and more economical route to expanding to the full (state limit of) 14,000-square-foot canopy. For the projects still in design, it can mean that one need not spend millions on lighting and HVAC (heating, ventilation and cooling) if it is outside the budget … This is a significant step forward for

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A Madison Heights, Michigan cannabis dispensary has reached an agreement with the city to have a Flock camera that pointed directly at the business removed, Click on Detroit reports. The agreement between the city and Jars Cannabis came after customers pushed back on the camera and Jars posted a “No Flock Zone” sign in front of the camera to block its view.  

In a social media post earlier this month, Jars wrote that the company shares the “community’s concerns about increased surveillance,” which is why they placed the sign in front of the camera. 

The camera was installed as part of a settlement between Madison Heights and the dispensary that allowed the company to open in the city. Madison Heights officials threatened the company with sanctions if it did not remove its sign, but the two sides ultimately entered into a revised settlement, which still requires final approval from the city council.   

“We thank everyone who spoke up, shared information, and held us accountable. This is not a flex. It was a situation we had a responsibility to address.” — Jars on Instagram 

Despite the removal of the camera aiming at the company’s parking lot, another Flock camera remains facing the street about 50 yards away. 

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For the third time this year the North Carolina Supreme Court has upheld a warrantless search sparked by the odor of cannabis, The Carolina Journal reports. In the State v. Schiene decision, the court referred to two previous cases decided this year as precedent and said because of those decisions it should have never accepted the case to begin with.   

“This Court recently reaffirmed that ‘we continue to follow our precedents which require examination of the totality of the circumstances to determine whether probable cause exists’ and that ‘the odor of cannabis is one factor that may be considered’ as part of this examination. … This Court has therefore already answered the single question on which review was allowed in this matter. As further review of this resolved issue would be superfluous, we conclude that discretionary review was improvidently allowed.” — Justice Phil Berger Jr., writing for the court. 

In 2024, the state Court of Appeals had also ruled against the defendant, Codie Brice Schiene, in his motion to suppress evidence uncovered in his vehicle during the warrantless search. Benjamin Kill, Schiene’s defense attorney, had argued the odor of cannabis was insufficient for a search because the state allows the sale and use of smokable hemp products, which smell the same as illicit

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