Are we in the middle of the third wave of cannabis?

Published Mar 9, 2021 10:00 a.m. ET
iStock / JuNiArt

Can you feel the wave? The third cannabis wave is fast approaching, or it may already be upon us. This wave is expected to be the biggest one yet. After the two previous bull market runs, which saw Canadian companies dominating the trading volume and market cap, it is now time for the American cannabis stock to have its turn to shine.

The unexpected circumstances

To understand what has converged to catalyze these circumstances, we must first take a good look at what happened in the United States. The Democratic victory in November last year provided a long-awaited change on the prospects of federal cannabis regulations, which are the prerequisite for interstate marijuana commerce.

Another significant development came when Georgia, a formerly Republic-controlled senate, handed the reigns to a Democratic administration.

Could we be moving into a perfect storm situation?

Is this the perfect storm? Yes, the stars are aligned, and Biden has indicated that there will be action on his commitment to decriminalize marijuana at the federal level. The Biden administration supports initiatives that will see marijuana become today's pharmacological rising star. There are a few companies that have yet to become public.

Celebrity involvement

Jay-Z’s The Parent Company’s involvement in the cannabis space is likely to signal other celebrities to align their brands with marijuana more aggressively, especially now that the Biden administration's rollout of their Federal cannabis strategy.

Monogram, Jay-Z's premium marijuana brand from his company The Parent Company, was also rolled into the company before the merger had raised 570 million dollars. The Parent Company,  currently trading in Canada under the symbol GRAM.U  and in the US, is trading under the ticker GRAMF.

Bring it back home, Bruce.

Canopy Growth Corp does not want to be forgotten and left behind in the third wave. Bruce Linton is set to launch Gage Cannabis on the public markets. This will bring Bruce, the former CEO and founder of the company, back to the global marijuana stage instantly.

Look at Clever Leaves Holding

Clever Leaves Holdings is a multinational marijuana operation with facilities in Portugal and Columbia, and the company is also importing business to Germany and Phoenix. This company has seen demand rise by over 50%.

Final words

Has the interest in cannabis and its stocks returned? Is it possible that the cannabis market is moving into the third wave for marijuana stocks? The first wave came in late 2012 or perhaps 2013. At this time, there were very few publicly traded marijuana stocks. Early 2016 saw the second cannabis wave begin. This step led to Canada legalizing weed for adult-use.

The peak of the second wave occurred as California was implementing legalization. Sadly the 2019 vaping crisis followed, and then we were all hit with the COVID-19 pandemic. As we approach what is deemed the third wave, we will likely see regulatory reforms in the US at the state level emerge, pushing the country one step closer to federal cannabis legalization. There is plenty of optimism surrounding what the third wave can bring, and many hope that investors will follow the sound cannabis companies.

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