💸 The Tape

There is a particular brand of Washington theater currently playing out across K Street, and it deserves a proper review. Hemp industry lobbyists, armed with talking points about consumer choice, small business freedom, and the sacred wisdom of the 2018 Farm Bill, are mounting a fierce defense of intoxicating hemp-derived products. They want lawmakers to know that adults should be free to purchase delta-9 THC gummies, delta-9 seltzers, and THCA flower at gas stations, smoke shops, and through the mail. Regulation, yes. Prohibition, absolutely not. Freedom, they insist, is on the line.

Meanwhile, the state-legal cannabis industry — the one with seed-to-sale tracking, pesticide testing, child-resistant packaging, METRC compliance, and onerous tax rates — continues to be treated like a criminal enterprise under federal law. And curiously, many of the same voices shouting loudest about hemp freedom have almost nothing to say about Schedule I, 280E, or the SAFER Banking Act.

Welcome to the most intellectually incoherent fight in American drug policy.

The Molecule Doesn't Care About Your Farm Bill

Let us state the obvious thing that regulators, lobbyists, and apparently a surprising number of federal judges seem willing to ignore: THC is THC. A delta-9 THC molecule extracted from a hemp plant and a delta-9 THC molecule extracted from a cannabis plant are, biochemically speaking, the same molecule. Your endocannabinoid system does not check the DEA's paperwork before binding to a receptor.

The entire legal distinction between "hemp" and "cannabis" rests on a single, arbitrary line drawn in 2018: plants containing 0.3% delta-9 THC by dry weight or less became hemp, which became federally legal. Everything above that threshold remained cannabis, which remained federally illegal. This threshold was not based on pharmacology, consumer safety, or any scientific principle related to psychoactivity. It was a 1970s-era botanical definition that got grandfathered into modern law because nobody expected chemists to actually show up.

But chemists did show up. And they discovered that if you start with compliant hemp biomass, you can synthesize delta-8, delta-10, HHC, THC-O, and yes, delta-9 THC itself in quantities that would intoxicate a small horse — all while technically keeping the final product under the 0.3% dry-weight threshold. A 100mg delta-9 gummy weighing 4 grams is, mathematically, 0.25% THC. Federally legal. Available via FedEx. Stocked at your local vape shop between the Zyns and the energy shots.

That same 100mg gummy, sold in a licensed Colorado or Massachusetts dispensary, requires a state license, plant tracking from clone to consumer, laboratory testing, and compliance with packaging rules that often run dozens of pages.

Same molecule. Same effect. Wildly different legal reality.

The Hemp Industry's Selective Libertarianism

Here is where the hypocrisy gets impossible to ignore. A significant faction of the intoxicating hemp lobby is currently fighting tooth and nail against the federal hemp products ban tucked into upcoming farm bill and appropriations legislation. They argue — with some merit — that banning these products would crush small businesses, eliminate consumer access, wipe out thousands of jobs, and hand the entire market back to the illicit sector.

All of those arguments are correct. They are also, word for word, the exact arguments that state-legal cannabis operators have been making for over a decade about federal prohibition of marijuana.

Yet the hemp lobby has largely refused to link arms with the broader cannabis reform movement. Many hemp trade groups have explicitly distanced themselves from marijuana legalization, preferring to protect their narrow legal carve-out rather than advocate for coherent, unified THC regulation. Some have gone further and actively opposed cannabis reform measures, apparently worried that federal legalization of marijuana would eliminate their regulatory arbitrage advantage.

This is not principle. It is protectionism wearing a freedom costume. You cannot credibly argue that adults deserve access to psychoactive cannabinoids while simultaneously arguing that the same adults should be arrested for buying those cannabinoids from a licensed dispensary across the street. Or rather — you can argue that, but nobody serious should believe you.

The Regulatory Vacuum Is Killing Everyone

The current split system is bad policy by every available metric. Licensed cannabis operators pay federal taxes under Section 280E that effectively range from 40% to 70% of net income, while their hemp-derived competitors pay normal corporate rates. Cannabis companies cannot deduct ordinary business expenses, cannot access traditional banking, and cannot ship products across state lines. Hemp companies can do all three — often selling the functionally identical product.

Consumers, meanwhile, navigate a confusing and genuinely dangerous marketplace. Hemp-derived intoxicants sold outside licensed channels frequently contain unknown synthesis byproducts, heavy metals, residual solvents, or simply much more THC than the label claims. Regulated cannabis products, whatever their flaws, at least come with mandatory lab results. The irony is that the "legal" federal product is often the less safe one.

And state regulators are losing their minds. Texas, California, Tennessee, Georgia, and a growing list of others have moved to ban or severely restrict intoxicating hemp products within their borders — creating yet another patchwork layered on top of the existing state cannabis patchwork. The industry is fighting a dozen state-level brushfires while ignoring the structural fire at the federal level.

The Only Honest Path: Regulate THC at the Federal Level

There is a clean solution, and it has actually been drafted. The States 2.0 Act, reintroduced by a bipartisan group including Senators Cory Booker, Dan Sullivan, and Rand Paul, would deschedule cannabis from the Controlled Substances Act and establish a framework allowing states to regulate cannabis products — including hemp-derived intoxicants — within a coherent federal structure.

The logic is simple. If a product contains psychoactive THC above some threshold meaningful to actual human physiology — not a botanical abstraction from a 1970s textbook — it should be regulated as a cannabis product. Full stop. That means:

Age-gated sales. Laboratory testing. Child-resistant packaging. Advertising restrictions. Taxation appropriate to a regulated intoxicant. Interstate commerce under federal rules. Banking access for compliant operators. And an end to Section 280E penalties that punish legal businesses for the crime of selling a legal product.

Under a States 2.0 framework, hemp farmers would still grow hemp for fiber, grain, and non-intoxicating CBD. Intoxicating products would be regulated as what they are — THC products — regardless of botanical origin. The arbitrage game ends. The compliance playing field levels. Consumers get safer products. States retain primacy over how they regulate sales within their borders.

This is the fight the hemp industry should be joining. Not the narrow, self-interested battle to preserve a loophole, but the broader, more defensible fight for rational federal THC policy. Because the current posture — demanding freedom for hemp operators while tolerating prohibition for cannabis operators — is not a political strategy. It is a moral and intellectual failure dressed up in lobbying invoices.

The federal hemp ban currently looming in Washington is going to happen, or something functionally close to it. The only question is whether the industry spends the next year fighting the wrong war — or whether it finally recognizes that the only durable protection for intoxicating products of any kind is a unified, federal framework that treats THC like the regulated substance it is. The States 2.0 Act, or something like it, is the way out.

📈 Dog Walkers

Minnesota Is On Trend

Here's a data point that deserves more attention than it's likely to get: youth cannabis use in Minnesota is declining — and it's been declining for over a decade, including after the state legalized adult use in 2023.

According to the 2025 Minnesota Student Survey, 96% of students reported no cannabis use in the past month. Among eighth, ninth, and 11th graders combined, self-reported cannabis use over the previous 12 months has dropped 57.7% since 2013. And in a notable reversal of a long-running trend, more students now perceive using cannabis once or twice a week as moderately to greatly harmful — a shift that flips the direction seen from 2013 through 2022.

The survey, conducted every three years by the Minnesota Department of Health (MDH), collects anonymous responses from students in grades five, eight, nine, and eleven covering health, wellbeing, and related topics. The 2025 edition is particularly significant because it's the first survey conducted since Minnesota legalized recreational cannabis — making it an early real-world test of one of the most persistent arguments against legalization: that it will lead to increased youth consumption.

So far, that argument isn't holding up.

Why This Matters Beyond Minnesota

The legalization debate has always been shadowed by concern about kids. Opponents have consistently warned that normalizing adult cannabis use sends the wrong message to young people, making them more likely to experiment. It's a reasonable concern on its face — and one that legislators in every state considering legalization have had to address.

But the emerging data tells a different story. Minnesota joins a growing list of legal states where youth consumption has either remained stable or actively declined following legalization. The pattern suggests that regulation, education, and controlled access may actually be more effective at reducing youth use than prohibition — a finding that aligns with similar trends observed in Colorado, Washington, and Canada after their respective legalization efforts.

The 57.7% decline over twelve years is especially striking. That's not a modest dip within the margin of error — it's a sustained, multi-survey trajectory that predates legalization and has continued through it. Whatever combination of factors is driving the decline — better education, shifting cultural attitudes, increased perception of harm, or simply more interesting things to do — legalization doesn't appear to have disrupted it.

The Nuance

Minnesota Health Commissioner Dr. Brooke Cunningham struck an appropriately balanced tone, acknowledging the positive trends while noting that "some of our children are encountering cannabis at young ages." Her call for parents to talk to kids about cannabis before they encounter it reflects a public health approach that treats education as the first line of defense rather than criminalization.

That framing matters. The conversation around youth and cannabis doesn't have to be binary — either legalization is fine for kids or it's a disaster. The Minnesota data suggests a more productive middle ground: legalize responsibly, regulate access tightly, invest in education, and measure the outcomes.

So far, the outcomes are encouraging. 96% of Minnesota students aren't using cannabis. The trend line is heading in the right direction. And legalization, at least in this early snapshot, hasn't changed that.

The data doesn't lie — even when it contradicts the narrative.

🗞️ The News

📺 YouTube

Trump Signs Executive Order + Hints at Cannabis Rescheduling | TTB Presented by Flowhub

What we will cover:

✅ In this episode of Trade To Black presented by Flowhub, host Shadd Dales and co-host Anthony Varrell break it down across two key segments.

Segment 1 features Christian Angermayer, founder of atai Life Sciences (NASDAQ: ATAI) and Beckley Waves, joining the show to talk about the executive order signed by Donald Trump aimed at accelerating psychedelic research. The focus is simple—what this actually means for the sector, and why this moment is getting real attention across mental health and biotech.

But what stood out during that press conference wasn’t just psychedelics.

Trump also referenced cannabis.

In a moment that caught attention, he told Joe Rogan the rescheduling process is being “slow walked,” then turned to his right and asked about getting it done. It wasn’t a formal update—but it was a clear signal cannabis is still part of the conversation.

Segment 2 brings in Michael Bronstein to break down the policy side, including new legislation from Senator Rand Paul that would allow states to control how hemp-derived THC products are regulated ahead of a potential federal crackdown in 2026.

Two sectors moving at different speeds—but both very much in play right now.