The cannabis industry in the US is celebrating as bipartisan lawmakers in the Senate and House reintroduced the Secure and Fair Enforcement (SAFE) Banking Act, aimed at bringing much-needed financial reforms to the cannabis industry. The bill, which has been reintroduced in both chambers by Senators Jeff Merkley (D-OR) and Steve Daines (R-MT), along with Representatives Dave Joyce (R-OH) and Earl Blumenauer (D-OR), would enable legal cannabis businesses to access banking and financial services and would protect financial institutions that deal with them from being penalized by federal officials.
The Reintroduction of the SAFE Banking Act Sends Cannabis Stocks Soaring
The reintroduction of the SAFE Banking Act has led to a surge in the stock prices of Canadian licensed producers (LPs) such as Canopy Growth (NASDAQ:CGC), Tilray (NASDAQ:TLRY), and Cronos (NASDAQ:CRON) in pre-market trading on Thursday. Other Canadian LPs, including Aurora Cannabis (ACB), Sundial Growers (SNDL), OrganiGram Holdings (OGI), and HEXO Corp (HEXO), also witnessed notable gains.
The Bill Would Help Protect Communities and Legal Businesses
Sen. Merkley has been vocal in his support for the bill and its potential benefits, stating, “Forcing legal businesses to operate in all-cash is dangerous for our communities; it’s an open invitation to robbery, money laundering, and organized crime—and it’s way past time to fix it.” The reintroduction of the SAFE Banking Act has given the industry renewed hope that there could finally be a path to much-needed financial reform.
The Bill Could Finally Get a Vote on the Senate Floor
Sen. Merkley has expressed his optimism that the reintroduction of the bill will lead to a positive outcome, stating that “for the first time, we have a path for SAFE Banking to move through the Senate Banking Committee and get a vote on the floor of the Senate.”
US Multi State Operators and Cannabis-focused ETFs Also Stand to Benefit
The reintroduction of the SAFE Banking Act also stands to benefit US Multi State Operators such as MedMen Enterprises (OTCQB:MMNFF), Curaleaf Holdings (OTCPK:CURLF), Acreage Holdings (OTCQX:ACRHF), Cresco Labs (OTCQX:CRLBF), Green Thumb Industries (OTCQX:GTBIF), Trulieve Cannabis (OTCQX:TCNNF), Ayr Wellness (OTCQX:AYRWF), Columbia Care (OTCQX:CCHWF), TerrAscend (OTCQX:TRSSF), and Clever Leaves Holdings (CLVR).
Cannabis-focused ETFs such as the AdvisorShares Pure Cannabis ETF (YOLO), Global X Cannabis ETF (POTX), ETFMG Alternative Harvest ETF (MJ), Amplify Seymour Cannabis ETF (CNBS), and AdvisorShares Pure US Cannabis ETF (MSOS) could also witness a surge in demand, should the bill finally pass.
Conclusion
The reintroduction of the SAFE Banking Act has given the cannabis industry a much-needed boost, as legal cannabis businesses in the US have been struggling to access banking and financial services due to federal restrictions. The reintroduction of the bill by bipartisan lawmakers has renewed hope that much-needed financial reforms could finally be on the horizon. Should the bill finally pass, it would help protect communities and legal businesses, and it would enable the industry to thrive in a safe and regulated environment.
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