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Trump Set to Sign Executive Order on Federal Cannabis Reform as Weed Stocks Surge
Washington, D.C. — December 13, 2025
President Donald J. Trump is poised to sign a landmark executive order directing federal agencies to reclassify marijuana under federal law, triggering a dramatic surge in cannabis-related stocks across global markets.
The anticipated order — expected as soon as Monday, December 15 — would move marijuana from its current Schedule I status under the Controlled Substances Act (the category reserved for drugs “with no currently accepted medical use” and high risk of abuse such as heroin and LSD) to Schedule III, a classification shared with certain prescription painkillers with accepted medical uses.
Market Reaction: A Green Rally
The financial markets reacted almost immediately to the news:
• Major U.S.-listed cannabis stocks saw double-digit gains on Friday, with Tilray Brands up around 28–35% and Canopy Growth jumping as much as 50% intraday.
• Cannabis-focused ETFs, including the AdvisorShares Pure US Cannabis ETF and Amplify Seymour Cannabis ETF, rallied strongly, reflecting broad sector optimism.
• Even traditionally unrelated sectors felt the impact: tobacco giants British American Tobacco and Imperial Brands slid as capital rotated into cannabis names.
Sector analysts characterize the spike as one of the most dramatic single-day rallies for pot stocks in years — a sign that investors believe real regulatory change could finally unlock decades of pent-up industry potential.
What the Executive Order Could Mean
If enacted, the executive order would not legalize marijuana nationwide — that requires an act of Congress — but it would significantly loosen federal barriers that have long constrained the industry. Key implications include:
• Tax relief: Companies currently face punitive federal tax treatment under Section 280E, forcing them to forgo normal deductions; moving to Schedule III would largely eliminate that penalty.
• Banking access: Rescheduling could make it easier for cannabis firms to open accounts, obtain credit, and attract institutional investors wary of federal risks.
• Research expansion: A Schedule III classification would ease restrictions on clinical studies, potentially accelerating medical research into cannabis therapies.
Industry advocates have long argued that federal classification as a “less dangerous” substance would unlock billions in economic growth and help normalize a patchwork of conflicting state laws.
Political and Practical Challenges Ahead
Despite the enthusiasm in markets, not all hurdles are cleared. A White House spokesperson has noted no final decision has been made, underscoring that the regulatory process — including internal agency rulemaking — could take months to complete.
Moreover, rescheduling will not instantly override all state laws, and significant debate remains among lawmakers, regulators, and advocacy groups over the pace and scope of federal cannabis reform. Full federal legalization remains a longer-term political battle, with legislative action still required.
What Investors Should Know
The surge in cannabis equities reflects not only hope for regulatory certainty but also speculative positioning. Analysts warn that while rescheduling offers meaningful structural benefits, the pathway to implementation is complex and subject to further legal and bureaucratic review. Nonetheless, for many companies that have operated for years under restrictive federal policy, this moment represents an unprecedented opportunity.
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Article written and configured by Christopher Stanley
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