The use of marijuana is illegal in many countries – but the United States may soon legalize cannabis, which will give a powerful impetus to the development of the entire industry. We figured out how the marijuana market works and how you can make money on it.
What will it lead to, how is marijuana harmful and what are its benefits?
A real boom in business activity has begun around cannabinoids in recent years. And the pandemic even pushed her to develop: people stayed at home and worried about the future, which stimulated the growth of marijuana sales.
Every year, analysts predict how big the cannabis market will be in the coming years, and time after time, it exceeds expectations. The most promising market is in the United States: according to analysts, by 2030, it will be worth $100 billion. By 2025, according to Global Market Insights, the market for medical marijuana alone can already be valued at $59 billion.
In 2018, Canada became the first G7 country to federally legalize marijuana use. And in the United States, the process of its legalization is actively underway. So far, 35 U.S. states, including the District of Columbia, have legalized marijuana and allowed it to be used for medical reasons. In 17 states, adults can legally use marijuana for recreational use—without a doctor’s prescription, just for fun.
With Joe Biden coming to power, the situation may change in favor of legalization supporters: now the Democrats control the White House and Congress. Namely, this party advocated the decriminalization of marijuana.
How the U.S. cannabis market works
At the federal level, the use and possession of marijuana in the United States are illegal. This causes many problems for the authorities, businesses, investors, and ordinary people and increases crime. Because of this, it is difficult for companies to expand and start working in new states.
Cannabis has historically had a reputation for being harmful. The traditional way of consumption is smoking marijuana. Recently, however, foods and oils containing cannabidiol have been gaining momentum.
Cannabidiol is a natural compound found in cannabis plants. It is located in hemp, a type of cannabis. Cannabidiol does not have psychoactive properties. In everyday life, cannabis and medicines containing cannabidiol are simply called medical marijuana.
Preparations containing cannabidiol are prescribed to treat patients suffering from chronic pain or seizures. New Frontier Data estimates that the hemp-derived cannabidiol market will grow from $390 million in 2018 to $1.3 billion by 2022.
Under current U.S. Food and Drug Administration (FDA) regulations, all drugs containing cannabidiol require regulatory approval. Under U.S. federal regulations, it is also illegal to sell cannabidiol-containing foods or supplements.
According to a Pew Research poll, 67% of Americans believe marijuana and cannabidiol use should be legalized. This is twice as much as in 2000 when only 31% of the population supported the legalization of marijuana. This is the highest marijuana approval rate in U.S. history. Given the growing support of citizens, a change in cannabis legislation looks quite real.
How to invest in the cannabis market
The U.S. cannabis sector is growing amid possible legalization. Experts are wondering what the industry might look like shortly: will large corporations come in, or will many independent companies divide the market.
The giants of the tobacco market have already begun to invest in the growing marijuana market. Cigarette maker Altria Group bought a $1.8 billion stake (45%) in marijuana company Cronos back in 2018. Other tobacco corporations also seek to diversify their business by buying stakes in cannabis-related companies. Or, for example, Uber, which plans to deliver marijuana as soon as it is fully legalized in the U.S.
There are enough options for the average private investor to invest in the industry: company stocks, ETFs or REITs, or even NFTs. The choice of companies is wide: some grow the plant itself, others supply farms with fertilizer and equipment, and others lease land for growing cannabis.
How marijuana affects the brain
You are relaxed and in a good mood. The colors are very bright, and the music seems to make its way to the bone. Time seemed to slow down. I want to live, laugh, and eat something delicious.
If that’s how you feel, you’re either in the Maldives or stuck.
Tetrahydrocannabinol, the main psychoactive substance in marijuana, is responsible for this condition.
The smoke enters the lungs, and then blood flow to the brain.
One of the reasons they want to legalize marijuana is that it would be a great medical tool. There is currently a lack of scientific evidence on how effective marijuana can be and diseases.
First of all, the ban on cannabis often slows down the learning process.
There are many varieties of marijuana, and scientists claim that they help with various diseases and even exist best marijuana strains for sex.
There are already many studies that confirm the medical potential of cannabis to alleviate:
- chronic pain;
- nausea and loss of appetite (for example, due to chemotherapy);
- Parkinson’s disease;
- inflammation of the intestine.
When we talk about the legalization of medical cannabis, we do not mean the free trade in jambs. It is about being able to create safe and convenient forms of medicine and control this process. But when legalization happens only to make money on it, it will harm the people. After all, this drug will be available, cheaper, and popular and can harm people who use it without special doses.