US Cannabis Legislation Update: “SAFE Act Gaining Speed”
Posted by Wayne Duggan
The ETFMG Alternative Harvest ETFMJ 1.42% is down 26.3% in the past three months as efforts to push US cannabis legalization in Washington, DC during the Joe Biden administration’s early innings did not go as fast as some investors had hoped had.
Bank of America analyst Heather Balsky said Monday that important steps in the cannabis legalization process could be imminent.
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SAFE Act Update: Balsky said the SAFE Banking Act, which would allow U.S. banks to service cannabis companies in states that have legalized cannabis, seems to be gaining traction in Congress even among Republicans. The law was recently passed for the third time in the House of Representatives.
It has eight Republican co-sponsors in the Senate, and Balsky said she believes it has enough bipartisan support to last. At the time, Balsky said the biggest question for the SAFE bill is how long the Senate Democratic and Majority Leader Chuck Schumer will wait to vote on the SAFE bill. She predicts that the SAFE law will be put to a vote by late 2021 or early 2022.
RELATED: How Long Does Senate Take to Approve the SAFE Banking Act?
Meanwhile, House Republicans David Joyce and Don Young recently passed laws to remove cannabis from federal controlled substances law. Ballsy said the Republican-sponsored legalization bill is unlikely to pass by this time, but it is an important symbol that legalization is becoming a bipartisan issue.
BWS Bill dead in the water? At the same time, the Democrats have their own law to legalize Booker-Widen-Schumer, which is expected to be presented to the Senate before June. Balsky said investors should be prepared for the volatility of cannabis stocks if the bill is rejected, which seems likely at this point.
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“Given the senators’ comments on the incorporation of social justice reforms into law, which are controversial among Republicans and some moderate Democrats, we fear that it will not be possible to get the 60 votes for the Senate,” said Balsky.
She said the ESPE bill will likely have to “run its course” in the Senate before the SAFE bill comes to the vote.
RELATED: Why the Cannabis Industry Needs Congress to Pass the SAFE Banking Act
Petrol gas setting: Cannabis stock investors shouldn’t be too disappointed if the BWS cannabis bill is rejected in the Senate, as Balsky’s comment suggests that the bill contains some controversial left-wing provisions that may not appeal even to some moderate Democrats. Given that the SAFE Act could be passed as early as late 2021, a possible sell-off of cannabis stocks after the BWS vote could be a buying opportunity.
This article originally appeared on Benzinga and was republished with permission.