Unknown unknowns in cannabis

DC
Planning for the unknown unknowns

What we don’t know: In a previous era of Republicans running Washington, Donald Rumsfeld warned about the “unknown unknowns.” 

Twenty-plus years later, the unknown unknowns are what’s keeping the cannabis industry on their toes when it comes to what’s happening in DC — and there are loads of them. 

But, Biden! There were unknown unknowns during the Biden Administration. Like, trying to understand when the rescheduling process would kick off or if SAFER Banking would ever get a vote in the Senate. 

And now, Trump 2.0: As we’ve written about, Trump 1.0 didn’t move the ball forward on cannabis reform. So the unknown unknowns are still out there this time around. Here are a few: 

The Attorney General unknown: The next Attorney General will oversee the DEA, the folks in charge of rescheduling. Last week, it was nominee Pam Bondi’s time under the Senate microscope. And Tom Angell of Marijuana Moment caused a bit of a Twitter/X stir by calling her response on cannabis reform “YIKES”. 

Rescheduling timeline unknown: Cultivated readers know that the rescheduling hearing that was due to start this week has been postponed for at least three months. So, let’s chalk up yet another unknown unknown to how that hearing will play out. Who will make the case for rescheduling from the DEA’s side, and how far out is the actual hearing? Time will tell, but you may recall we wrote about the inside baseball squabbling about if a delay is good or bad for the rescheduling process. 

The DEA leadership unknown: Way back in early December, there was a nominee for the head of the DEA: Florida’s Hillsborough County Sheriff Chad Chronister. But that was short-lived. There’s now a new “acting” head of the DEA, Derek Maltz Sr. Unfortunately, his position on cannabis isn’t unknown at all. He’s no fan. In fact, he once tweeted/X’d: 

The hemp unknown: The 2018 Farm Bill renewal got punted during the last Congress. Now there’s a different Congress, with new leadership, taking up the Farm Bill. And as you probably know, the Farm Bill regulates, or not — depending on how the next version shakes out — hemp and hemp-derived products. 

How and when the Farm Bill gets taken up, considered, debated, altered, and passed is anyone’s guess — hence, it’s an unknown. But, we did find this an interesting read this month: Congressional Research Service’s Farm Bill Primer: Hemp Industry Support and Regulation. Go read it, cannabis/hemp nerds. 

The big Trump unknown: During the campaign, Trump made known his thoughts about cannabis reform via Truth Social. He was supportive of Amendment 3 in Florida, supported banking reform, as well as rescheduling. But will Senate Republicans now adopt similar positions in Washington? Well, that’s the unknown unknown. 

What they’re saying: Last week, we heard from Saphira Galoob, the Executive Director of the National Cannabis Roundtable (now merged with the US Cannabis Council into the US Cannabis Roundtable) about what she’s looking for in DC: “There's a big misconception that we don't have as broad of support with Republican lawmakers as we do with Democrats. I can tell you that Republicans in Congress today want states to be in charge of the state. They want economic growth, and they want legal businesses to have access to all of the same kind of tools and financial opportunities that other legal businesses do.”

Bottom line: These are uncertain times for the cannabis industry and it sorely needs some good news. 

But, right now there are so many unknown unknowns that predicting what will happen is a fool’s errand. As we’ve said previously, hold on tight, it’s going to be a wild ride in 2025.  

-JR

“It’s crystal clear to me that the Justice Department hijacked the rescheduling process, placing politics above public safety…If there’s scientific evidence to support this decision, then so be it. But you’ve got to let the scientists evaluate it.” 

Interim DEA head Derek Maltz, Sr. said last year in an interview.

Shout out to Mark E. Merritt for following our YouTube channel. Much appreciated. Follow Mark for thoughts/updates and insights from our conversations from MJBizCon 2024. We’ll be releasing many more over the next few weeks: 

Verano Holdings EVP indicted 👨‍⚖️

Anthony Marsico, an executive vice president at Illinois cannabis firm Verano Holdings, was indicted last week along with three others on insider trading and conspiracy charges. Follow Jason Meisner from the Chicago Tribune for more. Of note, Marsico also has more than $445,000 in earnings from professional poker. Check out his WSOP page. (At least he reps the Verano brand at the table…)

Kentucky Democrats want to legalize it ✌️

Kentucky Democrats, fresh off the launch of medical cannabis at the start of this year, are looking to the 2026 ballot to allow state residents to vote on full legalization. We’ll keep you updated. 

Frontier Risk Group raises $3 million 🚀

Cannabis insurance startup Frontier Risk Group closed a seed funding round of $3 million, bringing their total funding to $6 million. The latest round was led by Casa Verde and the funding includes a strategic partnership with Illinois Casualty Company. Mark your calendars for 10 am Eastern today: Frontier Risk Group’s CEO James Whitcomb is joining Jay on Cultivated Live. Watch on LinkedIn or YouTube.

Blüm Holdings raises capital to expand 📈

Blüm Holdings announced that they secured $900,000 which will help close on three California acquisitions. 

Village Farms Dutch cannabis arm 🪴

Village Farms’ Dutch facility has harvested cannabis from their Leli Holland facility and will be reaching consumers soon, reports StratCann. (If Village Farms sounds familiar to you, it’s because they are one of the companies that pushed to have the rescheduling hearing delayed). 

Wynk expands to Florida 🍹

Cannabis beverage brand Wynk is expanding into Florida with its hemp-THC infused seltzers. The company says its products will be available in hundreds of retailers from Jacksonville to Miami. 

HYTN and SNDL form vape cart partnership 🤝

HYTN Innovations and SNDL formed a partnership to develop GMP-compliant vaporizer cartridges for international pharmaceutical markets, the companies said.

Jesse Redmond announced on X that he has been named the Head of Investor Relations and Business Development at LEEF Brands.

A chart from Statistics Canada data (the 51st state) shows that cannabis prices are down almost 30% since 2018 whereas alcohol prices are up more than 10% in the same period. Credit to Prof. Michael Armstrong of Brock University.

Will Indiana follow its neighbors’ lead on marijuana? | Indiana Capital Chronicle