In a move that signifies a dramatic shift from his previous term, President Donald Trump is reportedly gearing up to announce the federal reclassification of marijuana next Monday. This anticipated decision is already causing ripples across the financial markets.
As reported by The Washington Post and Axios, the White House plans to direct several federal agencies to reclassify cannabis, moving it from its current status as one of the most dangerous substances—alongside drugs like heroin—to a Schedule III classification. This would place it in the same category as pain relievers such as Tylenol with codeine and certain steroids.
The news sent immediate shockwaves through Wall Street. Shares of Tilray Brands surged over 30% before the market opened, with Canopy Growth and SNDL also experiencing double-digit gains. Specialized funds, including the Amplify Seymour Cannabis ETF, rebounded by more than 19% after enduring years of losses.
According to Newsweek, Trump discussed this measure from the Oval Office during a phone call with Speaker of the House Mike Johnson, Health Secretary Robert F. Kennedy Jr., and cannabis industry leaders. The conversation hinted that the government is finalizing the announcement's details.
During his campaign, Trump had pledged to enhance medical research on cannabis, and in recent months, he suggested that Medicare could potentially cover CBD-derived products. If realized, this decision would extend the process initiated by Joe Biden in 2023, which was never fully completed.
While Trump's pivot is dividing the Republican Party—more conservative factions oppose it—polls indicate that a majority of Americans support legalization. According to Gallup, 64% favor the reform, and over twenty states have already legalized recreational use.
Although reclassification won't equate to full legalization, it would pave the way for increased medical research and ease the industry's tax burden. Should the measure proceed, the DEA will embark on a regulatory process that might conclude by the summer of 2026, provided the White House stays the course.
Potential Impacts of Marijuana Reclassification
What would be the implications of moving cannabis to Schedule III?
Reclassifying cannabis as a Schedule III substance would reduce restrictions on research, potentially leading to new medical treatments. It would also lessen tax burdens for cannabis businesses.
How might this decision affect the cannabis industry financially?
The reclassification could boost investor confidence, leading to stock price increases and a potential influx of capital into the cannabis industry.
Is full legalization on the horizon with this reclassification?
While reclassification is a significant step, it doesn't imply full legalization. However, it could set the stage for further legislative changes in the future.