The cartels will NOT move in.
The cartels have legal opposition and lost revenue. The 2 things they “love” the most. They can either target the shops, sell to the shops or undercut the price even more. Of course there is the flip side of a the current $400/oz legal price cap, the illegal pot might jump in price and it will still look like a better deal. Whatever happens, it will likely not have been predicted as the law was being passed.