Recently, Darien Dash provided some significant insight into the future of the cannabis industry. Darien Dash is the CEO of the Movement Management Advisors, a company that has been uniquely positioned to provide support for clients who are working within the industry. He, and his company, represent clients that grow and sell marijuana as well as others who are positioning themselves as the leaders in the green revolution.
According to other sources, the legal marijuana industry in the United States is thriving. In 2018, it was estimated to have drawn in $10.4 billion and helped with the creation and maintenance of 250,000 jobs, all dedicated to the handling of plants themselves (this data comes from New Frontier Data). Looking at history, it’s clear to see that this industry is doing well, but what does the future hold.
What Is Ahead for the Cannabis Industry?
Darien Dash has a unique perspective in that he has noticed many of the changes in the industry over the years due to his work with clients. As he notes, marijuana is the most used and widely distributed illicit drug today – that’s not hard to see when you consider just how well known it is. Now, it is still considered a Schedule 1 drug, which means that it is illegal to use at the federal level. That means that, while some states may allow for it to be used in that state, traveling between states where it is legal is against the law. You also can’t travel internationally with legally acquired marijuana, even if you are traveling to a country where it is legal. That makes the entire process a bit more complex.
Still, at the time of this writing, 33 states had legalized the drug for medical use. In addition, 10 states have made it legal to use as recreation. Other states, including New Jersey, Connecticut, Illinois, and New York, are lined up to become the next states to make it legal, at least in some capacity.
As a result of this expanded use, it is possible to get some insight into what the future holds for the industry as a whole. Let’s focus on what Darien Dash believes are the four key ways that the cannabis industry will change in the coming years.
- The U.S. will likely legalize marijuana for recreational use at the federal level, making it legal to use.
- Millions of jobs will be created in the U.S. to support this new industry. This will also lead to the transformation of various industries as a result.
- An international – not just U.S.-based – economic boom will occur, helping to grow GDPs around the world.
- There is likely to be some backlash from politicians, communities, and others who are base use of marijuana on old stereotypes and truly don’t recognize the value of its use.
The change in federal law to allow marijuana is likely to create an incredible change in the country as a whole. There is no doubt that this will have a positive impact on the country’s economy as well as the culture here. It will have an ongoing implication around the world as well.
The problem is, according to Darien Dash, that there’s no clear and easy path forward to making this happen. While more people than ever recognize that marijuana – which they understand is an illicit drug – is beneficial and safe, especially in the use of medicinal uses, there’s still the question of how this shift will actually occur. When will marijuana go mainstream? When will investors, who are likely to play a big role in supporting this type of growth of the drug, be able to rest easy in making such decisions?
It’s a Domino Effect
One of the ways Darien Dash describes what is likely to occur is by seeing the federal legalization process as a domino effect. The drug first made illegal in the 1937 Marihuana Tax Act, has been in this type of prohibition period for a long time. Looking back at history, the alcohol prohibition was very costly and didn’t last that long, ending much sooner than what we are seeing with marijuana. When it does end, it’s likely to create some nice economic benefits.
As more and more states continue to make this drug more accessible and remove the drug from the illegal list, it is likely that national-level change will also occur. However, what’s also interesting is that Dash also notes that companies and investors do not have to wait until a national law goes into place to see real results. Rather, it is likely to see those results sooner.
We are already seeing that with the $10.4 billion profits in 2018 (as mentioned earlier) and the job growth. Once that legalization does occur, this will only allow for the further scaling of the industry beyond these figures. It’s likely to be quite impressive.
Politicians will find it very difficult to continue to ignore the possible profits and returns that come from this legalization process. Imagine how this could impact state budgets and, eventually, national budgets? For politicians, those job figures are likely to be a very attractive reason to encourage the legalization of the drug in their community.
Dash points to another statistic as well. By 2030, the marijuana industry is likely to be worth $57 billion around the globe. That amount would create $17.5 billion in tax revenue – and what politician can ignore those figures?
What’s even more powerful, though, is what the people want. Politicians are tasked with doing what their communities want to achieve goals in law creation. A Pew Research study indicates that 62 percent of people actually support the legalization of marijuana. In 1960, that figure was just 12 percent. In has doubled since 2000.
A Necessary Rebranding
There’s no doubt that many people maintain the same negative stereotypes surrounding the use of the drug. Imagines of it being used in the 1960s and 1970s and people spending their days high is still very much part of our culture. How will an industry grow to these financial heights when it comes to overcoming this type of negative stereotype?
According to Dash, it will take somewhat of a rebranding of the industry as a whole. The cannabis industry will need to reinvent itself. One of the ways this is already happening is moving the drug from a substance to get high to the image of a drug that has medicinal benefits. There are many dispensaries throughout the country already thriving because of their ability to support the needs of those who have medical needs. We are seeing these stores – which would never have advertised these types of offerings – now showing up in suburban malls where any consumer with the right medical ID card can pick up the drug.
This doesn’t mean that it will be easy. There are countless instances in which verifiable businesses are facing backlash and even difficulty finding space to provide services because of the perceived negative connotations of the drug’s use. This makes the path a little less easy, but it does not limit its potential climb. Cannabis is an industry that has already showed its ability to flex and change as needed.
Changes in the Justice System
While most people would never think twice about putting someone in prison for committing a felony crime, such as theft or murder, the perception about whether or not people should spend time behind bars for illegal use of marijuana is also changing.
That’s not to say there isn’t a need for even more change. Darien Dash points that out clearly. He writes, “With continued legalization, politicians will also be forced to recognize the social injustice sustained by the persecution of those who would imbibe in the illicit form of the drug. According to this article in Quartz, marijuana offenses have net 15 million arrests with a disproportionate amount being people of color.
It’s estimated that black residents of New York are eight times more lightly to be arrested for marijuana sales or possession regardless of similar rates of usage among other races.”
Changing the Economy
There may not be a more profound way for the cannabis industry to change the lives of Americans than the impact it will have on the economy as a whole once it is decriminalized. Right now, many banks struggle to provide financial support to companies of all types in the industry. This includes farmers growing marijuana, producers of the product, sellers, and so on. Because of the federal implications, many of these companies only deal in cash, even if they are in well-established communities and bringing in thousands of dollars a day.
What could happen, then, if the federal government legalizes this type of access? It could mean that these companies can become more authentic and safe to just use traditional bank accounts again. It would also mean that banks do not have to look over their shoulder and can help lend funds to those in the business legitimately. That can prove to be a windfall for the industry itself.
Banks traditionally provide loans to businesses that have a winning model – they have a business plan that shows growth and the desire and need for that company’s product or services in the community. From the figures presented here, it is clear that marijuana is likely to thrive. For banks, then, this is a solid bet. By putting money into the hands of the businesses, then, through legalization, there is no doubt this industry will grow and thrive, allowing marijuana to become more accessible and more versatile.
If big banks are not able to enter this market due to the continued gray area in lending to it due to federal limitations, they are losing money. That will not last long before changes begin to occur. New banking laws, as Darien Dash points out, are already helping to improve this situation by providing cannabis industry businesses with some confidence. The Secure and Fair Enforcement Banking Act is one prime example. This law makes it illegal for banks to discriminate against a cannabis business and aims to make it more likely for small businesses to secure the funds they need to open up in this sector.
Don’t Overlook the CBD Industry
There’s a subset of the cannabis industry that some do not realize. It’s the cannabidiol or CBD component. This is the part of the cannabis plant that is known for its medicinal benefits. It is non-psychoactive. That means that a person can see the medical benefits cannabis offers from using it, but they are not able to get high from using it. CBD is a powerful testament to the future of the cannabis industry because more public perception is changing in favor of using it. It has shown to be helpful in things like improving chronic pain, reducing seizures in patients, and improving the quality of life for people who are dying.
Today, in many states, you can buy creams, ointments, and many other components using CBD already. Whether you use it to reduce anxiety or help to reduce the impact of medications used to kill cancer cells, CBD is changing the world in terms of how it is impacting lives. It is that change, then, that will also help to encourage change in the public’s opinion of marijuana as a whole.
There’s so much more to expect here. For example, the FDA is now working to not just outright label foods with CBD in them as illegal, but to encourage approval before selling them.
There’s also the country up north that can provide a great deal of insight for the U.S. Canada made marijuana legal for recreational use in 2018. It clarified laws. Companies in Canada in the cannabis industry can now access loans. They are building reliable businesses with solid supply chains. Some companies are even on the Canadian Stock Exchange.
The future of the cannabis industry is bright and continues to provide incredible opportunities for those who are a part of it today. Once that federal bump in the road is crossed, there’s real opportunity present here.