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From Black Market to Booming Legal Industry

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The story of cannabis in America is one of resilience, transformation, and growing acceptance. Once outlawed, associated only with the shadowy underworld of black markets, cannabis now stands in the legal light, progressively winning approval in the medical and recreational realms.

A Historical Perspective

Cannabis and hemp have been part of human civilization for thousands of years, utilized for textiles, medicine, and ritualistic practices. While hemp, due to its strong fiber, was primarily grown in early America for industrial purposes, its psychoactive cousin, marijuana, remained somewhat obscure to the wider public.

The Marijuana Tax Act of 1937 was not just an economic regulation but also a move propelled by a combination of racial and economic factors. Stories propagated during this era, many deeply rooted in racial prejudice, framed cannabis as a substance that induced violent behavior. These narratives, combined with economic competition from the hemp industry, played a role in cannabis’s prohibition.

By the time the 1970 Controlled Substances Act came into play, cannabis was already deeply stigmatized. Its classification as a Schedule I substance placed it in the same category as drugs like heroin, indicating a substance with a high potential for abuse and no accepted medical use.

However, even in these prohibitive years, cannabis thrived in underground markets. Countercultural movements of the 60s and 70s embraced it, leading to its proliferation and, eventually, to states reconsidering its medical value by the century’s close.

Cannabis Breaks Through Legal Barriers

1996 marked a significant turning point in American cannabis history. Proposition 215, also known as the Compassionate Use Act, was passed in California, permitting the medical use of marijuana for patients with specific illnesses. This was a direct challenge to federal law and set a precedent for states’ rights on the matter.

Subsequent states’ approval for medical use indicated a shift in public opinion. The advancements in cannabis research and the growing number of patient testimonials on its therapeutic benefits played a pivotal role in this transformation.

By the time Colorado and Washington fully legalized cannabis for recreational use in 2012, the American perspective had evolved dramatically. The subsequent states that decriminalized and legalized cannabis did not just witness a change in law but also saw a surge in economic growth. The cannabis industry has since given rise to dispensaries, culinary innovations, and even tourism, generating millions in tax revenue and creating numerous jobs.

The journey of cannabis from a stigmatized substance to an accepted and commercially viable product showcases the power of research, advocacy, and evolving societal views. It also serves as a lesson in how perceptions can change and how policies can adapt in response to both evidence and changing societal values.

From Black Market to Main Street

Once associated largely with the black market, cannabis now basks in the glow of mainstream acceptance. It was a process that required innovation, ingenuity, and patience. As legal boundaries were pushed and shattered, business models were developed and fine-tuned, and technology, particularly digital and crypto currencies, played a crucial role.

Bitcoin particularly emerged as a preferred mode of transaction among cannabis vendors. One of the reasons was the reluctance of traditional banks to associate with companies in the cannabis industry, due to the federal ban. A concept that might seem alien to traditional finance sectors – like Bitcoincasino.us for instance, where Bitcoin is the primary currency – has found favor in this once marginalized industry.

The use of Bitcoin points to the ingenuity of an industry that has faced numerous obstacles in its journey from the black market to the mainstream. Instead of depending on traditional financial systems, they turned to encrypted, decentralized technologies, which in many ways reflect the spirit of the cannabis industry.

The Booming Cannabis Industry and Its Challenges

The market size of legal marijuana in the USA was estimated at $13.6 billion in 2019, with about 340,000 jobs devoted to handling plants, according to New Frontier Data. The cannabis industry’s two major segments, recreational and medicinal, both have broad spectrums of products appealing to different sections of the population.

Advancements and Innovations

The legitimization and growth of the cannabis industry have spurred developments and advancements that were previously unthinkable. The full potential of cannabis and cannabinoids is being unlocked, with a range of innovative and niche products flooding the market.

Challenges to the Cannabis Industry

While the cannabis industry has made remarkable strides in terms of legalization and public acceptance, it still navigates a myriad of challenges that inhibit its full potential. The juxtaposition of state-level legalization with federal prohibition creates an intricate maze for cannabis entrepreneurs. Federal illegality, while being a contentious debate on its own, brings forth tangible operational challenges. A prominent one is the restricted access to conventional banking systems. This limitation not only hampers the industry’s financial fluidity but also subjects businesses to unnecessary risks, as they’re compelled to operate predominantly in cash.

Influence of Bitcoin in a Complicated Scenario

Due to these banking conundrums, the cannabis industry has had to innovate and adapt. Enter Bitcoin, a decentralized digital currency operating without the conventional banking system. By virtue of its design, Bitcoin bypasses many of the challenges posed by the dichotomy of state and federal laws on cannabis.

The parallels between Bitcoin and the cannabis industry are uncanny. Both emerged from the peripheries of their respective sectors, surrounded by skepticism and controversy. But over time, as understanding and acceptance grew, so did their influence and legitimacy.

While to the average person, the mechanics of Bitcoin, especially concepts like blockchain, might seem intricate and daunting (much like trying to decipher the odds on a Bitcoin gambling site like BitcoinCasino.us), the cannabis sector has keenly recognized and harnessed its potential. This synergy underscores the industry’s resilience and adaptability.

The transformation of the cannabis industry from the fringes to the mainstream can be seen as a symbol of societal evolution. With the industry predicted to reach $73.6 billion by 2027, it is clear that the perception of cannabis is changing. As the industry continues to grow, innovate, and break boundaries, perhaps it can serve as an inspiration for other industries grappling with obstacles whether they be of perception, legality or innovation.

 

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Wet Marijuana – How Do You Dry Out Your Wet Stash?

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Whether you bought your cannabis or dried it yourself, there’s a good chance it got wet accidently. This might have happened by mistake or because the cannabis was washed purposely to eliminate contaminants and enhance its flavor. Regardless, it’s disheartening to devote time, money, or effort just to wind up with a useless product. But do not worry—there are solutions.

 

There is a narrow line between slightly moist buds and perfect stickiness, which some people prefer.

 

If your cannabis squishes when lightly squeezed, it’s likely overly damp. Buds should feel somewhat sticky because to the resin (which contains the cannabinoids), but they should bounce back slightly when squeezed rather than crush.

 

Wet cannabis may seem sticky, but it will not adhere to your fingertips. You’re seeking for buds with a honey-coated texture, comparable to baklava. If they feel wet or spongy, you have a problem.

 

Common Issues With Wet Cannabis

 

Difficult to Light 

It’s no surprise that wet cannabis is hard to ignite. If you can’t light it, you can’t smoke it.

 

Mold Risk 

Excess moisture, as explained in *How to Dry and Cure Cannabis*, complicates pot storage and can lead to mold. Smoking moldy cannabis is risky because it contains germs and fungus that can harm your respiratory system and increase your risk of pneumonia.

 

Bad Taste

If you somehow manage to smoke damp weed, it won’t taste great. It’s like smoking uncured cannabis—definitely not pleasant.

 

The Risks Of  Wet Weed

 

While smoking wet pot is not always harmful to your health, the length of time the bud remains wet can make a significant effect. A damp atmosphere is ideal for mould, fungus, and bacteria. So, if you keep your cannabis wet for too long, you may get more than you bargained for. Smoking mouldy cannabis can cause headaches, lung issues, and even pneumonia. As a result, if your weed became wet, it is safer to dry it straight away.

 

Regardless of whatsoever drying method you use, it is critical to examine your marijuana for mold before and after drying. If it has a nasty odor—like leftovers from last week—or if you notice something clearly growing on it, it’s better to toss it away. Now let’s look at what you can do if your marijuana becomes moist.

 

How to Dry Out Wet Cannabis

 

To save your damp weed, dry it out with moisture-absorbing ways. Whether you’re a grower who didn’t properly cure it, it got caught in the rain, you inadvertently spilled something on it, or it’s just unusually humid outdoors, there are several reasons why your cannabis may be storing too much moisture. Fortunately, there are several solutions to the problem.

 

Rice Drying Method

If you’ve ever spilled a drink on your phone, you’re probably familiar with this trick. It turns out uncooked rice isn’t just for saving electronics—it can help with wet weed, too. Place your wet buds in a bowl or bag, then cover them completely with dry rice.

 

The rice will draw out the excess moisture, helping your buds return to their ideal state. Depending on how wet your weed is, leave it in the rice for at least 24 hours. If it’s still damp when you check, give it another day. Just make sure to seal the container, and let the rice do the work!

 

Put a Paper Over the Problem

If your marijuana became wet, don’t worry—you can easily repair it with a paper bag. Simply place your moist buds in a closed paper bag and store them somewhere cool and dry. If you have a dehumidifier, now is an excellent time to utilize it. The paper bag circulates air while protecting your blooms from trichome-damaging light.

 

To increase moisture absorption, wrap your cannabis with paper towels before placing it in the bag. The paper towels will help absorb the extra wetness. Replace the towels and rotate your weed every several hours, checking for mold. This also helps to remove any trapped dampness from the bag.

 

Revive Your Damp Weed

If you’re a grower, you’re no stranger to the challenges of battling moisture and mold. After a successful harvest, properly curing your buds is essential. The same curing tools can also help remove moisture from buds that have become too damp. If your weed is fully soaked, start with the rice method. But if it’s just a bit moist, try placing a humidipak in your airtight container.

 

Avoid Cutting Corners

It’s tempting to use heat to hasten the drying process of damp weed. Ultimately, you most likely want to smoke it as soon as possible. It’s important to avoid shortcuts that utilize heat or light, though.

 

Your weed’s quality can be diminished by using a blow dryer, an oven, or leaving it outside in the sun. Terpenes and cannabinoids are broken down by light and heat, which lessens their taste and efficacy. You might lose strength in the process of gaining time. Furthermore, you run the danger of over-drying your buds, which makes for a harsher, less pleasurable smoke.

 

Moisture Prevention: Proper Weed Storage

 

Wet weed can be unpleasant at best, and downright destructive at worst (hello, mold!). While accidents happen, there are steps you can take to prevent excess moisture from ruining your stash. The key is to keep it in the Goldilocks zone—not too wet, not too dry. Freshness starts with proper storage. Keep your cannabis in an airtight container, stored in a cool, dry, and dark place. Simple, right?

 

Mason jars are a solid option, but for optimal care, consider investing in a specialized container like the CVault. It’s airtight, blocks light, and comes with a humidipak to keep your weed fresh longer. Just avoid plastic baggies—you’re a cannabis enthusiast, and dime bags are a thing of the past.

 

Bottom Line

 

If your cannabis gets wet, it’s crucial to act quickly to dry it out to avoid mold and maintain quality. Use methods like the rice drying technique or paper bag with paper towels to absorb moisture. Avoid using heat sources as they can degrade the weed’s quality. Proper storage in airtight containers and maintaining a cool, dry environment will help prevent future moisture issues. Always check for mold and other contaminants before consuming. By following these steps, you can preserve your cannabis’s flavor and potency.

 

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What Product Created $8,700,000,000 in Tax Revenue for States in Just 36 Months?

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The legalization of cannabis has transformed the economic landscape of many states across the United States. New federal data reveals that since 2021, states have collectively collected over $8.7 billion in marijuana taxes. This figure not only highlights the financial potential of legalized cannabis but also reflects changing public attitudes toward marijuana use and its regulation. As more states embrace legalization, understanding the implications of this revenue generation becomes crucial for policymakers, businesses, and communities alike.

 

The Landscape of Cannabis Legalization in the U.S.

The journey toward cannabis legalization in the United States has been long and complex. Cannabis was criminalized in the early 20th century, with the Marihuana Tax Act of 1937 effectively prohibiting its use and distribution. However, attitudes began to shift in the late 20th century, with California becoming the first state to legalize medical marijuana in 1996.

 

The momentum continued to build, culminating in Colorado and Washington becoming the first states to legalize recreational marijuana in 2012. Since then, a wave of legalization has swept across the nation, with 21 states and the District of Columbia now allowing recreational use.

 

Current Legal Status of cannabis legalization in the  U.S

 

As of September 2024, a total of 21 states have legalized recreational marijuana, while a dozen more permit medical use. The regulatory frameworks vary significantly from state to state, influencing tax structures, sales practices, and usage regulations. Some states have opted for high taxes on cannabis sales as a means to generate revenue, while others have focused on creating a more accessible market for consumers.

 

Tax Revenue Breakdown

 

 Overview of Revenue Generation

 

According to recent federal data, states have amassed over $8.7 billion in marijuana tax revenue since 2021. This revenue comes from various sources, including excise taxes, sales taxes, and licensing fees imposed on cannabis businesses. The breakdown of this revenue is essential for understanding how different states are capitalizing on legalization.

 

  • Excise Taxes: These are taxes imposed directly on the sale of cannabis products. States like California and Colorado have implemented excise taxes that can range from 15% to 30%, depending on local regulations.

 

 

  • Licensing Fees: States also collect significant revenue through licensing fees charged to cannabis growers, manufacturers, and retailers. These fees can be substantial and contribute to the overall financial picture.

 

State Contributions

 

California: The Leader

 

California remains at the forefront of marijuana tax revenue generation. Since legalizing recreational cannabis in January 2018, the state has collected over $3 billion in taxes alone. The state’s complex tax structure includes a 15% excise tax on retail sales and additional local taxes that can vary widely by municipality.

 

The revenue generated has been earmarked for various public services:

 

 

 

Colorado: A Model for Success

 

Colorado was one of the first states to legalize recreational marijuana and has since become a model for other states looking to implement similar legislation. Since legalization, Colorado has generated over $2 billion in tax revenue from cannabis sales.

 

The state’s tax structure includes a 15% excise tax on wholesale transactions and a 2.9% state sales tax that applies to all retail sales. Local jurisdictions can impose additional taxes as well.

 

Colorado has utilized its cannabis tax revenue for various purposes:

 

 

 

Illinois: Rapid Growth

 

Illinois is another state that has seen rapid growth in marijuana tax revenue since legalizing recreational use in January 2020. In just over three years, Illinois has collected more than $1 billion in cannabis taxes.

 

The state imposes a tiered excise tax based on THC content:

 

 

 

Illinois has directed its cannabis revenue toward social equity programs aimed at addressing historical injustices related to drug enforcement policies.

 

Economic Impact Beyond Tax Revenue

 

 

Legalizing marijuana has led to substantial job growth across various sectors. As of early 2024, nearly 15,000 cannabis dispensaries operate in the U.S., employing an estimated 93,000 workers. This includes roles in cultivation, processing, distribution, and retail. Additionally, the industry stimulates job creation in ancillary sectors like software development, accounting, and construction. The cannabis sector is projected to grow further, potentially increasing legal cannabis jobs by 250% over the next decade.

 

 

The burgeoning cannabis industry presents numerous business opportunities for entrepreneurs. The market has attracted significant investment, leading to the establishment of various businesses ranging from cultivation facilities to dispensaries and ancillary services. In 2022, consumers spent approximately $30 billion on legal marijuana products, surpassing expenditures on chocolate and craft beer. This consumer spending not only benefits cannabis businesses but also generates substantial tax revenue for states.

 

 

Cannabis tax revenue often supports local communities by funding essential services. For instance, Colorado has allocated millions from cannabis taxes toward education and homelessness services. This redistribution of wealth enhances community welfare and infrastructure.

 

 

Legalization also reduces the costs associated with enforcing drug laws. States can reallocate funds previously used for law enforcement to other community programs, further amplifying the positive economic impacts.

 

 Long-term Economic Growth

 

As the cannabis industry matures, it is expected to contribute significantly to overall economic growth. Projections indicate that the total economic impact of the cannabis industry could reach nearly $150 billion by 2026, underscoring its potential as a major economic driver in the U.S.

 

Community Benefits

 

Beyond economic metrics, communities are experiencing benefits from legalized marijuana:

 

 

 

 

Challenges Ahead

 

Despite the positive economic impacts associated with marijuana legalization, several challenges remain:

 

  1. Federal Regulations

One significant hurdle is the ongoing federal prohibition of marijuana. While many states have legalized its use, cannabis remains classified as a Schedule I substance under federal law. This creates complications for banking and taxation:

 

 

  1. Social Equity Concerns

 

As states continue to generate substantial revenues from legalized marijuana, there is growing concern about social equity:

 

 

 

 

  1. Market Saturation

 

As more states legalize marijuana and existing markets expand, there is potential for market saturation:

 

 

 

Prospective Developments

As more states legalize recreational marijuana, tax revenues are expected to continue rising. With 37 states and Washington, D.C., having legalized some form of cannabis by 2024, the potential for increased tax revenue is significant. Experts estimate that nationwide legalization could generate up to $8.5 billion annually for all states. This growth will likely be driven by expanding markets and consumer acceptance, as well as the introduction of new products and services within the cannabis industry.

 

States are experimenting with various tax structures to optimize revenue while ensuring competitiveness against the illicit market. The adoption of potency-based taxation—taxing products based on THC content—has emerged as a trend in states like New York, Illinois, and Connecticut. This approach aims to create a more equitable tax system that can adapt to market changes and consumer preferences. However, states must remain cautious about overtaxing, which can drive consumers back to illegal markets.

 

 

The allocation of marijuana tax revenue will continue to be a critical issue. Many states have earmarked funds for essential services such as education, public health initiatives, and infrastructure improvements. For instance, Colorado has directed substantial portions of its cannabis tax revenue toward school construction and behavioral health programs. As revenues grow, states may face pressure to diversify spending or address social equity issues related to past drug enforcement practices.

As the cannabis market matures, prices may stabilize or decline due to increased competition and efficiency in production. This maturation could result in fluctuating tax revenues as consumer behavior adjusts. States that have seen significant price drops—like Colorado, where prices fell by 60% from 2014 to 2023—may experience challenges in maintaining consistent revenue streams. Policymakers will need to adapt their strategies accordingly.

The ongoing conversation about federal legalization could dramatically impact state revenues. If cannabis were legalized at the federal level, it would open up interstate commerce opportunities and allow cannabis businesses access to traditional banking services. This change could lead to an influx of investment and further stimulate job creation within the industry.

 

As states continue to collect substantial tax revenues from marijuana sales, there is growing recognition of the need for social equity initiatives. Many advocates argue that a portion of tax revenue should be directed toward communities disproportionately affected by past drug policies. Future developments may include programs aimed at providing grants for minority-owned businesses within the cannabis sector or funding for substance abuse treatment programs.

 

.

 

 Conclusion

 

The collection of over $8.7 billion in marijuana taxes since 2021 demonstrates not only the financial viability of legalized cannabis but also its potential impact on public services and community development. As more states navigate their paths toward legalization and regulation, it will be crucial for policymakers to address challenges related to equity, access, and federal regulations.

 

With continued advocacy for reform at both state and federal levels, along with innovative approaches to taxation and regulation, the future looks promising for both consumers and businesses within this burgeoning industry. As society continues adapting its views on cannabis use, understanding these dynamics will be essential for maximizing benefits while minimizing challenges associated with this rapidly evolving sector.

 

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Federal Cannabis Roundup: Nixon, DEA, Tobacco-Hemp . . . and the DOOBIE Act (*sigh*)

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Last week, I wrote a round-up post on Oregon cannabis. This week, I thought I’d drop a line on the federal happenings. Which are quite a few.

The Nixon tapes

This was a fun piece of news, unearthed by Minnesota cannabis lobbyist Kurtis Hanna. Ernesto Londoño then broke the story on September 14th for the New York Times, which you can read here. In short, Nixon conceded that marijuana “is not particularly dangerous,” despite calling the plant “public enemy No. 1” only two years prior. And he opined that punishments ought not be so serious for possession of the plant.

I say this news is “fun” because it’s more interesting than surprising and I doubt it will have much impact. Nixon was a mean old liar, and one with an animus toward certain groups of people. I also don’t think this revelation will persuade the vocal, diminishing minority of prohibitionists to change their minds. I like it anyway, especially as cannabis history nerd. We were right!

DEA embraces two-step review for marijuana rescheduling

This one is important, in my opinion. It relates to the method of analysis DEA must undertake when determining whether a drug, including marijuana (and psilocybin, and any other verboten substance), has a “currently accepted medical use.” In April, the Department of Justice’s Office of Legal Counsel (OLC) put DEA in a box on this one, explaining that the old, five-part test was “impermissibly narrow.” OLC thus endorsed the two-part test. On September 17th, DEA assented to the test for Schedule I review.

The two-part test bodes well for DEA’s rulemaking, now underway, to move marijuana from Schedule I to Schedule III of the federal Controlled Substances Act. How do we know? Well, the Schedule I stans don’t like it, for starters. This is because, under two-part review, a drug can have currently accepted medical use: a) even if that drug hasn’t been approved by FDA, and b) even if the drug wouldn’t pass DEA’s scrapped five-part test. So, more runway.

DOOBIE Act on the way?

I’m embarrassed even having to type that. But yes, some Congressperson named a federal cannabis bill the “DOOBIE Act,” unfortunately. With a press release and everything.

This proposal would prohibit federal agencies from denying security clearance and employment to people simply because they have used marijuana. In my reading of the actual bill, these agencies could still ding an applicant for past marijuana use, but they couldn’t “base a suitability determination . . . solely on the past use of marijuana by the individual.” The word “solely” needs to go.

Because this bill applies only to “Executive agencies” under 5 U.S. Code § 105, it also wouldn’t have prohibited, say, Joe Biden from doing his “doobie” staffers dirty, which he definitely did.

FDA gets the nod on tobacco-hemp

I like the Congressional Research Service (CRS) and often send people thataway. On September 16th, CRS published a new report titled “Legal Effect of Marijuana Rescheduling on FDA’s Regulation of Cannabis.” Here are my extremely condensed takeaways:

  1. FDA can authorize tobacco products containing hemp-derived cannabinoids (although it hasn’t yet). This is because hemp is not a controlled substance.
  2. Marijuana, even at Schedule III, would still be banned as a tobacco additive (and probably always will be). This is because FDA would need to approve specific cannabis medicines first, and it never does that for botanical drugs.

Here we have one of those cognitively dissonant outcomes often seen with the cannabis plant. As a reading of law it makes sense, but as to policy it’s nonsense. You can thank Richard Nixon and other cannabis heels for that.



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