Cannabis Update: Policy, Sales & Culture - Jan 25

The Big Picture

The cannabis sector entered the long weekend with a string of policy and demand wins that investors should notice. Ohio started sending cannabis tax revenue to local governments and Arkansas reported record medical sales of $291 million for 2025, signaling both political acceptance and steady consumer spending.

Federal momentum is also in play, with bipartisan proposals addressing CBD coverage and hemp regulation, and continued debate over how a December rescheduling order will be applied. What does that mean for your portfolio, and will cultural buzz translate into sustained revenue growth?

Market Highlights

Key data points and headlines that matter as of Friday, January 23, heading into the long weekend.

• Ohio revenue distribution: Cities and towns that host recreational dispensaries began receiving cannabis-derived tax proceeds, tied to a 10 percent cannabis excise tax. State officials are releasing funds after prior delays, and the move removes a political flashpoint for local governments.
• Arkansas sales surge: Medical cannabis sales hit a record $291 million in 2025, a $15 million, or roughly 5.4 percent, increase over 2024 totals. That beats the previous state record of $283 million set in 2023.
• Legislative outcomes: South Dakota senators voted against debating bills to ban intoxicating hemp and kratom, effectively stalling a potential prohibition at the state level.
• Federal policy headlines: A December executive order focused on medical rescheduling remains under legal and industry scrutiny, while lawmakers introduced bipartisan proposals to give the FDA clearer authority over hemp and to explore CBD coverage in Medicare.
• Pop culture tailwinds: Viral celebrity moments and social creators are keeping cannabis culturally visible, from Wiz Khalifa lighting up with Argentine star Duki, to viral cannabis comedy creators and long-running celebrity anecdotes that normalize use.
• Sector trackers to watch: $MSOS, $TCNNF, $GTBIF, $CURLF, $TLRY are on many investors' lists as primary ways to track the space, with the last U.S. trades occurring on Friday, Jan 23.

Key Developments

Federal policy and CBD coverage push

Two MJBizDaily pieces highlight a narrowing focus in federal action. President Trump's Dec. 18 executive order emphasized medical cannabis rescheduling, a point legal experts say could limit immediate recreational implications. Separately, bipartisan legislation would put hemp regulation squarely under the FDA and could open a path for Medicare CBD coverage, which would broaden patient access and create a clearer regulatory framework for cannabinoid products.

For you as an investor, more FDA authority and the prospect of Medicare coverage mean bigger addressable markets for compliant CBD and hemp companies, but timing and legislative details will drive near-term moves.

State wins: Ohio distribution and South Dakota stall

Ohio finally released cannabis tax revenue earmarked for municipalities that host dispensaries, resolving a political standoff that had left nearly $11 million tied up last year. That payout is a practical win, since local revenue receipts reduce political resistance to cannabis businesses and can speed local permitting decisions.

In South Dakota, senators voted not to take up debate on banning intoxicating hemp and kratom, a defensive win for the hemp and edibles market in that state. These state-level outcomes matter because regulatory battles are often decided locally, and you should watch municipal and state budgets as a barometer for acceptance.

Demand and cultural normalization

Arkansas' record $291 million medical sales highlight steady consumer demand in regulated markets. Cultural moments reported by High Times, including Wiz Khalifa's viral session with Argentine star Duki and new creators turning cannabis into mainstream comedy, are helping normalize use across demographics and regions.

Cultural normalization is not a guarantee of sales growth, but it lowers stigma, which can speed retail expansion and brand partnerships. In short, the tide is turning in favor of mainstream adoption, and that could lift long-term growth prospects.

What to Watch

Here are the catalysts and risks you should track this week and next, and why they matter for your holdings.

• Regulatory moves: Watch for FDA signals on hemp rules and any congressional hearings on CBD Medicare coverage, both of which could change market access for consumer brands.
• Rescheduling clarity: Monitor legal analysis and agency guidance on whether federal rescheduling will apply only to medical cannabis, since that affects banks, research, and business models.
• State rollouts and tax distributions: Expect more municipalities to receive funds, which can reduce opposition to new dispensaries and speed local licensing decisions in states like Ohio.
• Sales data: Keep an eye on quarterly state sales releases and metrics from smaller markets, since Arkansas' 2025 results show growth can come from medical channels even when national headlines focus on recs.
• Market trackers: If you trade sector products, watch $MSOS, $TCNNF, $GTBIF, $CURLF, and $TLRY for ETF and large-cap exposure. Remember, U.S. markets were closed on Sunday, so last trades were on Friday, Jan 23.
• Reputational and policy risk: Psychedelics reformers warned that one mistake could derail progress, a reminder that political missteps or regulatory pushback can ripple across adjacent reform agendas.

How should you position yourself, and which names deserve priority? Focus on companies with clear compliance programs and diversified revenue streams, and keep cash ready for volatility around legislative milestones.

Bottom Line

• Policy and demand are aligning, with federal proposals and state revenue distributions reducing barriers and increasing market openness.
• Arkansas' record $291 million in medical sales is proof that regulated demand is expanding, not contracting, in some states.
• Watch FDA and congressional action on hemp and CBD, because a Medicare coverage decision would be a major catalyst for product adoption.
• Cultural normalization, from celebrity moments to viral creators, supports long-term brand building and consumer acceptance, but it does not replace regulatory certainty.
• Be selective, manage risk around upcoming policy dates, and use tracked tickers like $MSOS and $TLRY to get sector exposure without single-stock idiosyncrasy.

FAQ

Q: Will federal rescheduling cover recreational marijuana? A: As of the Dec. 18 executive order, the focus is on medical rescheduling, and legal experts say recreational coverage is not guaranteed, so you should expect a phased approach.

Q: How does Ohio releasing tax revenue affect local cannabis growth? A: Distributing the 10 percent tax reduces local opposition, speeds permitting and can make municipalities more open to new dispensaries, which helps companies expand regionally.

Q: Should I buy cannabis ETFs or single stocks now? A: That depends on your risk tolerance; ETFs like $MSOS give diversified exposure, while single stocks can offer higher upside and higher risk, so you should balance exposure and watch upcoming policy catalysts.