With its rise in popularity, what comes next, and how will it impact each person in the country? Here is the cannabis outlook for 2023.
Legalization of Cannabis Throughout the Country
When discussing cannabis legalization, it’s essential to differentiate between the levels of legal use. Since cannabis use is illegal on the federal level, individual states have their own laws about whether and in which ways cannabis is legal.
One type of legalization is for medical use. This allows people to use cannabis products as a form of medication. State residents usually receive a medical card, similar to a prescription, allowing them to buy cannabis products.
Another type of legalization is for recreational use. This allows adults to use cannabis products without a medical card while following local laws and guidelines for smoking in public areas.
Five states had recreational legalization measures on their ballots in November: North Dakota, South Dakota, Missouri, Arkansas, and Maryland. The push for legalized use is at an all-time high heading into 2023, with 68% of Americans saying they support legalizing marijuana, according to a poll conducted by Gallup.
In a sign of changing attitudes, President Joe Biden granted a federal pardon in October that restored full political, civil, and other rights to any person previously convicted of minor marijuana possession charges, according to the White House. This action may indicate that state-level pardons and federal decriminalization is around the corner.
The Cannabis Industry
The federal legal status and state-by-state patchwork regulations have left many investors wary of cannabis businesses and products. However, as public and legal acceptance grows, many expect the same for the industry. In fact, cannabis data company BDSA projects that cannabis sales will grow from $30 billion in 2021 to $57 billion in 2026, according to a news release.
“Over the next 12 months, I predict that every major institutional investor in the U.S. will make an investment in this industry,” equity company Privateer Holdings co-founder Brendan Kennedy told Yale Insights.
When legalizing cannabis, many states consider the need to reconcile the wrongs done by the War on Drugs, the name for U.S. efforts to combat illegal drug use with harsh penalties.
“Public opinion has shifted dramatically in favor of sensible reforms that expand health-based approaches while reducing the role of criminalization in drug policy,” according to Drug Policy Alliance.
Because the War on Drugs disproportionately affected minority groups, 13 states have created regulations that require some of the money from cannabis sales to benefit those groups, according to the Cannabis Industry Journal. For example, these regulations require assigning a set number of cannabis business licenses to people previously charged with marijuana possession, investing in community programs, offering financial aid, or funding educational efforts.
“The goal of social equity laws is to ensure that people from communities disproportionately harmed by marijuana prohibition and discriminatory law enforcement are included in the new legal marijuana industry,” according to the National Association of Cannabis Businesses. “Policymakers are working to address criticisms that outsiders are setting up legal cannabis businesses and profiting by doing the same things their less fortunate neighbors were arrested and given jailtime for just a few years ago.”
One of the hurdles to growth in the cannabis industry is that federal laws prevent cannabis businesses from using the country’s banking system. However, if legislation passes, it would give legal cannabis businesses banking access.
“Proceeds from a transaction involving activities of a legitimate cannabis-related business are not considered proceeds from unlawful activity,” according to the bill summary.
With growing legal acceptance, expanding investment opportunities, and more changes on the horizon, 2023 is looking to be a positive year for the cannabis industry and the number of people who have access to marijuana products.