Ask most people what's holding cannabis back and they'll say regulation. Seth Yakatan thinks that's only part of the answer. The bigger battle, in his view, isn't about whether cannabis is legal — it's about who gets to control how people access it. And that fight has been playing out in a much messier way than most people expected.
The Farm Bill opened a door nobody was ready for
The 2018 Farm Bill was written to support hemp farmers. What it actually did was crack open one of the most contested distribution questions in the industry's history. A wave of entrepreneurs saw the opening and ran through it — hemp-derived THC products started showing up in gas stations, grocery stores, and convenience shops across the country. For the first time, something very close to cannabis was sitting in the places where people already shop, without any of the friction that comes with a dispensary visit.
"The Farm Bill created a bunch of unintended consequences — and a lot of really gritty, really smart, young entrepreneurs ran into that hole as fast as possible."
Yakatan was watching this happen in real time. He went into roughly twenty grocery stores in Iowa last summer and found THC beverages in every single one, with staff recommending flavors and running two-for-one deals. That's not a niche market. That's normalization happening on its own, outside of any legislative framework.
The backlash came from two directions
Not everyone was happy about it. Yakatan is pretty candid about who pushed back and why.
"Alcohol does not want this product to exist, period. And alcohol is a very well funded, very well organized, very powerful federal lobby."
But the opposition wasn't just coming from alcohol. A lot of licensed cannabis operators — people who had spent years navigating state regulations, building out cultivation and retail infrastructure, and doing everything by the book — also didn't love the idea of competing with a product that bypassed all of that. They'd made significant bets on the regulated channel being the channel. Hemp-derived THC complicated that story considerably.
"When you remove that extra step out of the process, people are like, holy shit, I want to use this."
That's the part that stings a little, even for people who are nominally pro-cannabis. The dispensary model, for all its legitimacy, still requires consumers to take an extra step — to seek out a specific type of store, often in a part of town they wouldn't otherwise go to, and engage with a purchasing process that still carries some stigma for a lot of people. When that friction disappears, demand shows up in places nobody expected.
What this is really about
Yakatan frames this less as a policy debate and more as a distribution battle. The question of who gets to reach the consumer, through which channels, and who captures the margin along the way is going to shape the industry more than any single piece of legislation. The operators and brands that figure out how to be present where people already are — not just where the law currently permits — are the ones who are going to define what mainstream cannabis actually looks like.
That doesn't mean the regulated channel loses. But it does mean that the assumption that dispensaries will always be the primary point of access is worth questioning. The consumer has already shown, pretty clearly, that when you make it easy they show up. The industry is still figuring out what to do with that information.
