A groundbreaking executive order by President Trump could soon reclassify marijuana, reshaping the cannabis industry and igniting debate over federal drug policies.
Story Summary
- President Trump is poised to sign an executive order to reclassify marijuana.
- This move sparks significant gains in cannabis stock prices.
- Reclassification could change tax regulations and spur investment.
- Analysts see this as a positive shift, though challenges remain.
Trump’s Executive Order: A Game Changer for Cannabis
President Donald Trump is expected to issue an executive order as soon as Monday, which would reclassify marijuana from a Schedule I drug to a less-regulated Schedule III drug.
This marks a significant shift in federal policy and has already led to a surge in cannabis stock prices, with companies like Tilray Brands and Canopy Growth seeing gains of over 44% and 52%, respectively.
This anticipated move comes after a report from The Washington Post and is seen as a potential catalyst for investment in the sector. Reclassification would allow cannabis companies to benefit from different tax regulations, potentially encouraging further growth and innovation.
Analysts suggest that this change, if implemented, could pave the way for banks to engage with the cannabis industry more freely.
Trump expected to sign executive order to reclassify marijuana as soon as Monday, source tells CNBC; pot stocks surge
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— Todd Harrison (@todd_harrison) December 12, 2025
Implications for the Cannabis Industry
Reclassifying marijuana could have broad implications, not only for the industry itself but also for federal and state regulations. A reclassification to Schedule III would move marijuana into a category with less severe restrictions, akin to drugs like steroids and Tylenol with codeine.
This change is expected to provide a more favorable regulatory environment and could accelerate the timeline for further legal reforms.
Analysts like Ed Groshans of Compass Point view this development as inevitable, noting the positive outlook for the cannabis sector. However, challenges remain, as the industry continues to push for broader legalization and regulatory changes that address safety, access, and criminal justice reform.
Challenges and Opportunities Ahead
Despite the optimism, some experts caution that reclassification represents only a partial victory. Shawn Hauser, a partner at Vicente LLP, emphasizes the need for continued advocacy to achieve full legalization and comprehensive policy reform.
She argues that while the executive order may dismantle outdated drug policies, it is just the beginning of a longer journey towards meaningful change in public health policy.
The Supreme Court’s potential involvement in a case concerning state regulations and federal prohibition of cannabis could further influence the landscape.
A favorable ruling could expedite changes and solidify gains made through reclassification. As the industry navigates these developments, stakeholders remain cautiously optimistic about the path forward.
