Trump’s consideration of reclassifying marijuana from Schedule I to Schedule III marks one of the most significant potential changes to federal cannabis policy in decades. Schedule I drugs, which include heroin and LSD, are considered to have no accepted medical use and a high potential for abuse. Schedule III substances, such as ketamine and certain steroids, are recognized as having legitimate medical applications with a lower risk of dependency.
The move is rooted in growing political and public pressure. Over the past several years, a majority of U.S. states have legalized marijuana for medical or recreational use, creating tension between state laws and federal classification. Veterans’ advocacy groups, medical researchers, and cannabis industry leaders have pushed for reclassification, arguing that the current status stifles scientific research, burdens legitimate businesses, and conflicts with widespread acceptance of marijuana’s medical benefits. Trump’s administration has indicated that these factors, alongside the potential economic boost and shifting public opinion, prompted a serious review of marijuana’s legal status.
Reclassifying to Schedule III would have far-reaching consequences. For healthcare and research, it would remove many bureaucratic hurdles, allowing universities, hospitals, and pharmaceutical companies to conduct more comprehensive studies on cannabis and its compounds. For marijuana businesses, the change would open access to standard tax deductions and potentially pave the way for better banking relationships, as federal barriers to financing begin to ease.
For states where cannabis is already legal, the shift would align federal policy more closely with existing laws, reducing the risk of raids or prosecution for businesses complying with state regulations. However, the drug would still remain a controlled substance under federal law, meaning it would not be fully legal nationwide. Possession and distribution outside the boundaries of state laws could still result in federal charges, though penalties would be less severe than under Schedule I status.
News of the potential reclassification sent marijuana-related stocks soaring, with companies such as Tilray, Canopy Growth, and Aurora Cannabis seeing double-digit gains. The AdvisorShares Pure U.S. Cannabis ETF surged roughly 25% as investors bet on a friendlier regulatory environment. While the proposal stops short of full legalization, it signals a dramatic shift in federal policy—one that could reshape the cannabis industry, healthcare research, and the relationship between state and federal law.
