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December 29, 2025
Built by a former cannabis regulator, Policy, Decoded helps operators read the policy terrain before it shifts beneath their feet.
As we wrap 2025 and head into the New Year, the signs are coming into focus: hemp is headed toward tighter federal definitions, and marijuana rescheduling is moving deeper into federal process, litigation risk, and real-world compliance gaps. Today’s briefs track where the pressure lands first: banking, workplaces, research, taxes, and the state backlash cycle that follows every federal move.
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🎆 Year end policy reset
🧾 Schedule III process
🌾 Hemp definition squeeze
Happy New Year. Keep your standards tight.
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The deeper pattern behind today’s moves — and why it matters next
The State Era Is Ending. The Standards Era Is Starting.
🧾 Context: 2025 ended the era when cannabis policy could be treated as a state-by-state experiment running beneath a sleepy federal ceiling. States have carried this issue for decades because Washington did not. They built medical programs, then adult-use markets, then the taxes, inspections, and enforcement tools that made the system feel real to consumers and local governments. Hemp followed the same pattern after the 2018 Farm Bill, when a federal definition created room for national commerce and a lot of states tried to keep up with rules that were never written for a fast-moving finished-products market. This year, the consequences of that loose federal lane became harder to ignore, and Congress moved toward language that would shut it down by treating many finished products as marijuana once they cross a tiny THC-per-package threshold. At the same time, the White House ordered DOJ to finish the Schedule III process for marijuana, pulling federal agencies back into a lane that states have managed for years. You can feel the shift in the stories that defined the year: taxes rising in places like Michigan, fast compliance timelines for intoxicating hemp in places like Ohio, and a growing list of states trying to separate regulated low-dose models from the synthetic and slapdash retail category that keeps triggering crackdowns.
🔎 What It Signals: This is federalism with money attached, which means it gets serious quickly. When Washington tightens hemp and loosens marijuana’s schedule, states lose some of the practical freedom they had when federal inaction let them improvise and iterate. The dormant Commerce Clause questions get louder when products move across state lines, and hemp has already been the proving ground because it built national supply chains under a federal label while states tried to regulate locally. Revenue is the next pressure point. States built budgets around cannabis taxes, and local governments built expectations around host fees and public safety costs, while a narrow federal definition can erase categories of sales and shift consumer demand overnight. The politics also move in predictable directions. When rules tighten or prices move, ballot questions and veto fights follow, and 2025 closed with Ohio in open conflict over hemp beverage rules and Massachusetts staring at a serious rollback campaign track. Federal action will not erase state power, but it will change the boundaries, and those boundaries will shape investment, enforcement, and consumer safety.
🧠 THC Group Take: Here is the honest end-of-year read: the states built the cannabis economy because Washington would not. That was liberating for a while. It also produced a market that grew faster than its guardrails, and 2025 is the year that tab came due.
Hemp is where you can see the federal mood most clearly. Congress is not trying to punish everyone who acted responsibly. Congress is trying to shut down a national intoxicating market that slipped through a definition that was never written for knock-off gas station candy. That sweep is going to be messy, and the industry has one credible move if it wants a lane to survive: stop arguing for exception and start offering structure. Defined servings. Real age-gating. Testing that meets accredited standards. Enforcement that welcomes the knock on the door when someone is selling synthetics out of a gas station. The low-dose beverage model survives when lawmakers can describe it to a congressional town hall of parents and grandparents.
Marijuana rescheduling is different and the same. Different because it runs through process and litigation, and it will not turn into overnight normalcy. The same because Washington is stepping back into the fray and insisting on a record that can survive. The rescheduling headline matters, and the effective date matters more, and the months between them are where opponents will try to stall the whole thing on procedure. If you run a business, plan for momentum and budget for delay. If you are waiting for banking to magically unlock…don’t. Big banks will not move until Congress gives them a clean statutory lane, and 2025 already told you how allergic they are to ambiguity.
So what should you take into 2026? The era of drift is ending. The era of standards is beginning. The jurisdictions and companies that win will be the ones that can explain their model in plain English, defend it on public health terms, and show regulators a lane that deserves to exist. Everyone else will spend the year explaining why they should be spared from the crackdown that someone else made inevitable.
Fast-moving headlines, flagged for what matters.
Congressional researchers are warning that Trump’s rescheduling executive order is a directive, not a self-executing legal change, and DOJ could still choose a slower path or deprioritize completion. The analysis frames rescheduling as an administrative and legal decision that has to survive process steps, including how the record is built and how agencies explain medical use, abuse potential, and enforcement tradeoffs. That matters because the industry’s biggest near-term prize, 280E relief, arrives only after a final rule takes effect, not when a President signs an order. The same researchers note Congress retains the ability to tighten controls in parallel, including by targeting tax parity or other downstream consequences even if Schedule III advances. The practical consequence is expectation management: companies can plan for momentum, and they still have to budget for delay, litigation, and uneven federal follow-through. (Marijuana Moment)
Trump’s December 18th executive order tells Attorney General Pam Bondi to finish the move to Schedule III, and the order itself does not change federal law. Regulators quoted by NPR describe two tracks: DOJ can run standard notice-and-comment, or try a faster path under the Controlled Substances Act that narrows input and accelerates a final rule. Even with Schedule III, interstate commerce stays illegal and federal drug-testing posture stays unsettled until agencies publish guidance. The first real business impact arrives on the effective date of a final rule, because 280E relief follows the schedule change, not the headline. Until then, capital, payments, and compliance remain stuck in the gap between public expectation and federal permission. (NPR)
Industry leaders and researchers expect a sharp jump in U.S. cannabis research once marijuana is officially placed in Schedule III, because institutions that rely on federal funding will have fewer reasons to treat the category as radioactive. Trulieve CEO Kim Rivers says the company wants to bring a time-release marijuana medicine to market aimed at Parkinson’s symptoms, a sign that some operators are thinking past flower and into FDA-style development. Curaleaf chair Boris Jordan argues the bigger win is data that separates which components and consumption forms carry risk and which can be developed responsibly. For decades, researchers have been stuck with surveys or federally sourced cannabis that does not resemble what consumers actually buy, which limits credible conclusions about potency, product formats, and harms. If Schedule III sticks, expect more trials built around real-world products and more pressure for product standards that regulators can defend. (MJBizDaily)
Trump’s December 18th executive order tells DOJ to finish the Schedule III process, and workplaces still live under current federal rules until a final rule takes effect. Mondaq flags the employer problem that never waits for the Federal Register: safety-sensitive roles, drug testing policies, and insurance posture. State protections for lawful off-duty use keep expanding, which puts more pressure on impairment standards and job function analysis instead of category bans. HR teams are already fielding questions from employees who assume rescheduling means immediate protection. Hemp adds friction because lawful products can still trigger employment disputes when policies punish presence rather than performance. (Mondaq)
Major banks are signaling that the December 18 rescheduling order does not give them a safe federal basis to fully bank cannabis, even if Schedule III ultimately lands. Bank lawyers describe reading the order as oriented toward medical use and research, leaving adult-use revenue as a continuing tripwire for institutions supervised by federal regulators. Without clear federal legislation, banks expect routine cannabis deposits and loans to keep triggering heightened monitoring and suspicious activity reporting risk. Industry advocates argue the intent is normalization for a market that already functions across most states, and that the current posture keeps capital expensive and pushes financing offshore. Cash-heavy storefronts and constrained credit remain the default until Congress provides a clean statutory lane. (New York Post)
A YouGov survey released December 26th found 70% of Americans support moving marijuana to a less restrictive federal schedule. Support cuts across party lines, including majorities of Democrats, independents, and Republicans. The same poll found 76% say cannabis has legitimate medical value, and a majority supports allowing adult possession. That margin gives federal agencies political cover as they build a record that can survive litigation and pick an effective date that does not invite a quick stay. It also raises the cost of state-level rollback pushes that treat legalization as politically isolated. (Marijuana Moment)
Trump reportedly wanted to announce the Schedule III decision on Truth Social before an executive order was drafted, and White House lawyers shut it down in the room. A witness describes staff pressing process steps and timing, with the message delivered at full volume: the paperwork comes first. The same account ties the decision to early December meetings that included Trulieve CEO Kim Rivers, Trump ally Howard Kessler, and Florida Sheriff Gordon Smith. Speaker Mike Johnson was reportedly looped in and argued marijuana is a gateway drug, a reminder that Republican resistance did not disappear with the order. The rollout is being treated as a legal project built to hold up when the first procedural challenge hits. (HuffPost)
The executive order on rescheduling and a Medicare CBD lane is giving hemp stakeholders a sharper argument as Congress weighs language that would narrow finished products on a fast timeline. Newsmax reports the spending package language would treat products above 0.4 milligrams of total THC per package as cannabis, and industry voices warn that could sweep in full spectrum CBD and disrupt compliant supply chains. The order does not rewrite the Farm Bill, but it explicitly calls for working with Congress to keep certain hemp-derived CBD products available while targeting higher-risk products. That posture supports a distinction between disciplined, age-gated low-dose beverage models and the synthetic, convenience-channel category that drove backlash. The policy fight now runs on calendar math: delay, define, and separate lanes before supply chains lock in spring decisions. (Newsmax)
An op-ed argues Trump’s cannabis order creates an opening for Congress to revisit the pending hemp definition change before it snaps supply chains on a deadline. Adam Terry, CEO of Cantrip, warns that a fast effective date could disrupt full spectrum CBD products and freeze spring contracting decisions as growers and brands try to avoid inadvertent illegality. The piece reads less like a mandate to Congress and more like an advocacy play to steer lawmakers toward a clean, enforceable distinction. That distinction still matters: disciplined, age-gated low-dose beverages with defined serving sizes belong in a regulated lane, and synthetics and slapdash retail deserve a harder enforcement posture. The calendar is the leverage point, and the industry will need to earn it through credible safety commitments and proof, not urgency alone. (Marijuana Moment)
Dayton bar and restaurant owners say they have less than 90 days before low-dose THC drinks vanish from their menus under Ohio’s new intoxicating hemp restrictions. Gov. Mike DeWine signed the new law on December 19th and used a line-item veto that owners say erased the one-year runway they expected for beverages sold in adult settings. Operators in the Oregon District told WHIO they treated the drinks like alcohol, kept them 21+, and built real demand that now feels stranded by the timeline. The sweep hits compliant, age-gated low-dose models alongside the synthetic and convenience-channel products that triggered backlash. March 2026 is now the operational deadline for inventory, menus, staff training, and enforcement posture all at once. (WHIO-TV)
Ohioans for Cannabis Choice says it will run a referendum campaign to block the new law that tightens adult-use rules and forces most intoxicating hemp products out of general retail. The group argues the bill rewrites what voters approved in 2023 and is trying to contest both the cannabis rollbacks and the hemp crackdown in one campaign. The first step is petition certification, followed by a statewide signature drive with county distribution requirements. If the referendum qualifies, implementation pauses while voters decide at the next regular election. The fight shifts from legislative drafting to paid media, retail disruption, and enforcement uncertainty. (Ganjapreneur)
Michigan retailers report a late-year buying rush as consumers stock up ahead of a new 24% wholesale cannabis tax that takes effect January 1, 2026. The levy stacks on top of the existing 10% adult-use excise tax and 6% sales tax, with lawmakers projecting roughly $420 million annually for road funding. Industry groups say the tax will tighten margins in a market already defined by falling prices and consolidation, and they are appealing after a judge declined to block implementation. Some retailers expect a renewed push toward medical sales, which the wholesale tax does not hit, while others predict uneven price impacts depending on how much cost larger chains can absorb. December demand gets pulled forward, and January opens with a pricing reset that tests consumer loyalty. (Grand Haven Tribune)
Massachusetts elections officials certified 78,301 signatures for a 2026 ballot initiative that would roll back adult-use legalization. The petition would preserve medical marijuana and keep adult possession and gifting legal while ending licensed adult-use sales and adult home cultivation. The measure heads to the Legislature when they return to session on January 7th, with a May 5th deadline for lawmakers to act before the campaign can trigger the next qualification step. Supporters would need another signature round by July 1st to land on the November 2026 ballot. This is now a live political track that will pull tax revenue, local control, and home grow into a sustained campaign argument. (Boston Herald)
Virginia enters the 2026 General Assembly session with adult possession legal and a commercial market still on ice, feeding demand into gray channels and the limited medical lane. A retail framework passed earlier and was vetoed by Gov. Glenn Youngkin, keeping the state stuck between legal possession and an absent regulated storefront system. Governor-elect Abigail Spanberger told WDBJ7 she wants tight regulation, clear labeling, and potency transparency so consumers know what they are buying. She also pointed to dedicating revenue to oversight and education, a signal she is thinking about durability and administration, not only launch speed. With the session beginning January 14th, Richmond is back to a simple choice: build the rules for a real market or extend a stalemate that keeps consumers guessing. (WDBJ7)
North Carolina hemp businesses are reading Trump’s rescheduling order as a possible reset for a market that has lived under fuzzy federal lines and uneven state enforcement. A local farmer told Spectrum News 1 the practical win would be clearer rules on packaging, testing, and age restrictions that shut down synthetics and mislabeled products without punishing compliant hemp supply chains. A nurse interviewed in the piece framed the research push as a path toward legitimacy through better data on dosing, safety, and drug interactions. The politics remain active, with Sen. Ted Budd and other Republicans already on record against rescheduling and the state still debating its own broader cannabis posture. The next year will reward states that separate disciplined, age-gated low-dose products from higher-risk channels using clear rules that can be enforced. (Spectrum News 1)
A new 501c6 trade group, the Nebraska Cannabis Trade Alliance, is forming as the state’s medical cannabis program moves from ballot victory into implementation. The group says it will represent licensed medical cannabis operators and allied professionals, framed around patient access, public safety, and regulatory compliance. It is limiting membership to participants committed to operating within Nebraska law and regulations, and it is emphasizing Nebraska-based accountability in how it presents itself. The timing matches early program building pressure and the reality that rules, licensing, and enforcement posture will decide whether the program works for patients. Regulators and legislators now have an organized counterweight that will show up in hearings, stakeholder sessions, and rule drafts. (NewsByWire)
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From the hearing room to the comment section — we’re watching it all.
🩺 Phase 3 back-pain data is showing up in the mainstream conversation, which strengthens the medical rationale agencies will rely on when they defend Schedule III. If the evidence base broadens for common conditions, the policy argument shifts from cultural debate to clinical and reimbursement questions. (The Wall Street Journal)
📰 Conservative media validation of rescheduling gives Republicans more room to support process and research without wearing a partisan costume. That matters when attorneys general and Hill staff decide whether to fight the rule on substance or focus on procedure. (New York Post)
🧑💼 Platform enforcement keeps acting like an invisible compliance cost for licensed cannabis brands, even when the content is lawful under state rules. Inconsistent takedowns can erase basic business reach right when brands are trying to behave like normal consumer companies. (stupidDOPE)
🌱 Hemp’s sustainability pitch is moving into a higher-proof era as climate funding tightens and policymakers demand measurable claims. The environmental case holds best when it is tied to lifecycle data, processing efficiency, and supply-chain design that can survive scrutiny. (HempToday)
🧠 The Bloomberg News editorial board lands on a real point: the U.S. built a massive state-legal cannabis market without federal product safety standards or a modern research engine that matches the scale of use. Rescheduling can support that work, but the win will come from potency standards, additives rules, impairment science, and public health messaging that separates regulated low-dose lanes from high-risk products and youth exposure. (Bloomberg News Editorial Board)
🚗 The Washington Post editorial board is pressing states to treat cannabis-impaired driving like a real enforcement and public health file, not an afterthought of legalization. The argument lands because THC impairment is still hard to measure roadside, and potency has moved faster than policy tools, which leaves states relying on weak standards and inconsistent deterrence. (Washington Post)