Election years often stir the pot for the cannabis industry, and 2024 was no exception. While cannabis wasn’t the political hot potato of the season, several states tackled legalization questions—some even dabbling in psilocybin reforms. From game-changing legislative shifts to market momentum, this year showcased a blend of hurdles and headway for the growing sector. Here’s a breakdown of the year’s biggest moments and their potential impact under the incoming administration.
DEA’s Big Move: Cannabis Rescheduled
The DEA made history in April by announcing its intention to reschedule cannabis from Schedule I to Schedule III under the Controlled Substances Act. Cue the confetti—this marks the most significant federal progress toward legalization in over 50 years!
President-elect Trump, however, has been less clear on his stance. While he hinted at support for Florida’s legalization efforts earlier this year, his administration’s position on rescheduling remains uncertain.
Regardless of political posturing, the DEA’s decision will take time to implement, with a complex regulatory process likely stretching into next year. If successful, rescheduling could ease some of the industry’s toughest challenges, like Section 280E tax headaches, lack of patent protections, and bankruptcy barriers. However, new hurdles could emerge, including increased FDA oversight and regulatory misalignment between federal and state laws.
Still, this move has lit a fire of optimism across the industry, fueling hopes for broader federal legalization in the near future.
States Blaze the Trail
State-level initiatives continued to expand cannabis access in 2024. Recreational cannabis is now legal in 24 states, while 40 states allow medical cannabis. November ballots included legalization proposals in Florida, North Dakota, South Dakota, and Nebraska.
While recreational measures failed in the Dakotas and Florida, Nebraska voters approved two complementary proposals to legalize and regulate medical cannabis—marking a significant milestone for a state where cannabis was previously entirely illegal.
According to Pew Research Center, 74% of Americans now live in states where cannabis is legal for medical or recreational use, with dispensaries increasingly accessible. Public support continues to soar, hitting a record 70% in favor of legalization, according to Gallup. The writing’s on the wall: state-level momentum shows no signs of slowing.
Cannabis Research Takes Root
The green wave in legalization has spurred a surge in cannabis research. With consumer demand on the rise, understanding the plant’s therapeutic potential has become more critical than ever.
In 2024, universities and private institutions launched numerous studies exploring cannabis’s efficacy in treating conditions like chronic pain, epilepsy, and PTSD. The DEA’s rescheduling announcement is expected to remove bureaucratic barriers that have long hindered cannabis research, paving the way for more groundbreaking discoveries.
This influx of research funding and interest not only legitimizes the industry but also sparks innovation, from novel products to improved formulations. The future looks bright for cannabis-based science—and possibly a little less hazy.
Market Growth: A Budding Economy
Despite a challenging investment climate, the U.S. cannabis market bloomed in 2024, with sales projected to hit $40 billion by year-end. States with newly legalized markets fueled much of this growth, alongside a steady uptick in consumer demand.
While capital raises and mergers and acquisitions (M&A) remained sluggish, experts predict a rebound as federal legalization prospects improve and distressed assets become ripe for investment. Venture capital and private equity firms are increasingly eyeing opportunities in the sector, signaling brighter days ahead for entrepreneurs and operators.
That said, challenges like oversupply, price compression, and grey market competition persist in mature markets like California. Even so, 2024 offered a glimmer of hope, proving the industry’s resilience and potential for sustained growth.
Looking Ahead: What’s Next for Cannabis?
The developments of 2024 reflect a tipping point for the cannabis industry. As federal legalization gains traction, state-level progress continues, research accelerates, and markets expand, the sector is poised for its next big leap.
However, the question remains: Will the new administration embrace this momentum or pump the brakes? Either way, stakeholders should be ready to adapt, innovate, and seize opportunities in this evolving landscape.
In the ever-changing cannabis industry, one thing is clear—there’s never a dull moment. As the saying goes, the grass is greener where you water it. Here’s to hoping 2025 brings plenty of rain.
