The White House confirmed Thursday that President Biden will be able to pardon all prior offenses for simple cannabis possessions. There was a possibility of broader marijuana reform, and the stocks of cannabis went up.
The pardons will also apply to anyone in Washington DC convicted of simple possession of marijuana, a senior administration official told reporters.
Biden said no one should be in jail for using marijuana.
This was a historic moment for the U.S. cannabis industry, but the question is what will happen next?
Even after yesterday's spike, Cantor Fitzgerald's analyst Pablo Zuanic said there were reasons to be bullish. According to a Friday analyst note, Zuanic said President's pardons would help speed up the talks between Senate Democrats and Republicans to pass SAFE Plus.
The SAFE Banking Plus Act is an updated version of a bill that contains provisions to protect financial institutions that provide services to state-legal cannabis businesses. Equity components are also included in it.
The issuance of pardons could help reduce the pressure on Democrats to add a few restorative justice features to SAFE Plus, which could hurt Republican support to pass the bill. The analyst believes that little would change without SAFE Plus in the short term.
The Department of Justice U.S. Department of Health and Human Services review process to change the status of marijuana in the Controlled Substance Act could take a minimum of 1 -- 2 years. Without a final recommendation for the descheduling or rescheduling of cannabis, the U.S. exchanges won't be able to uplist cannabis stocks. Uplisting is possible with SAFE Plus, according to the analyst.
Zuanic highlights three important questions in relation to Biden's pardon announcement : a Is this just election posturing, b was this done in isolation from Senate Democrats working on federal level reform, c does this stall SAFE Plus and suck the air from the negotiations?
The executive action is already signed and the process has begun, but the timing is suspicious, and Zuanic answers to the first one.
While we do not know for certain, we do not think the White House acted in isolation. Our view is that his action facilitates the negotiations with Republicans in the Senate for SAFE Plus. If SAFE Plus passes in the lame-duck period, it would become effective immediately, while the DOJ HHS procedure could take a year or two.
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