Crypto just learned what cannabis already knows

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It's easy to spot the similarities between crypto and cannabis — especially where the speed at which Washington regulates bumps up against the expectations of retail investors in an emerging industry.

The CLARITY Act, crypto's big regulatory bill, failed a procedural vote in the Senate earlier this week and appears dead. The price of bitcoin immediately dropped, and so did the stocks of associated companies like Circle and Strategy, which had been pushing the regulation.

It's easy to remind yourself here of the SAFE Banking Act, a cannabis banking bill that first passed the House in 2019 and has yet to get a vote in the Senate. A bipartisan group of lawmakers reintroduced it in both chambers in June, the latest attempt in a seven-year cycle of House passage and Senate purgatory. 

Each time the bill comes up for a vote, cannabis stocks run. And each time the vote goes against the bill, the run-up turns into a sharp correction. Just look at the $MSOS chart, an ETF that holds a collection of US cannabis stocks. 

This is what happens when much of the price action is controlled by retail investors, who are, for lack of a better term, trigger happy on news events, rather than long-term institutions who can afford to stay patient. 

Both the crypto and cannabis industries are practically begging for regulation, however imperfect that regulation may be, and however much the process gets captured by a handful of specific companies.

Still, the reality is much slower than everyone, including the market, expects.

The absence of coherent rules creates an environment ripe for fraud and illicit sales, and in the cannabis industry's case, real public health harms. It's something every emerging industry needs to contend with at some point. Blowback comes with size. 

But don’t expect any quick fixes. This is the speed of capitalism bumping up against the American legislative system, designed to be deliberately methodical and slow. 

-JB

Curaleaf CEO Boris Jordan said “over 50%” of Aurora shareholders are supportive of the company’s $4-per share hostile bid for the company in an AMA session on Thursday.

Aurora (maybe they read our newsletter yesterday), seems to be taking a more offensive approach. 

CEO Miguel Martin took to X to explain Aurora's at-the-market program, which lets the company sell shares straight into the open market and has become a sticking point in the press release battle between the two. Curaleaf questions why Aurora would sell shares below the offer price if its board says the bid is too low, and filed in Alberta on Monday to halt the offering.

Martin’s response?

“Curaleaf wants to make a big deal of it,” as the program was put in place well before the offer. The fight continues, and the clock runs out on December 1. 

$ACB ( ▲ 0.52% ) $CURLF ( ▲ 2.81% )

The Michigan Cannabis Industry Association endorsed Republican John James for governor, betting on his pledge to gut the state's new 24% wholesale tax. His Democratic opponent still won't take a position on the levy, which operators say is pushing sales toward the illicit market.

A proposed Federal Reserve guide on vendor risk management for banks under $30 billion in assets singles out "marijuana-related businesses" as an example of higher-risk clients that may warrant more advanced BSA/AML tools. The guide is non-binding and open for comment through November 16.

The Michigan Cannabis Regulatory Agency revoked Michigan Investment 10 LLC's medical processor license, closed its adult-use license, and slapped on a $2 million fine after a two-year enforcement fight. The violation that stuck in regulators' craw: a required extraction-room surveillance camera was aimed at a wall instead of the actual work, said CRA Executive Director Brian Hanna.

Sammy Dorf, who co-founded Verano, and former Verano CFO Brian Ward launched Playdate, a non-alcoholic hemp-infused rosé with 15mg of THC per bottle at $19.99. The Chicago startup claims it's the first THC rosé made at commercial scale and ships nationwide where state law allows.

The California beverage brand is rolling out four 12-ounce, 10mg THC cans in New York dispensaries, its sixth recreational market, with Farmer Group handling cultivation and distribution. More flavors and formats are slated for early 2027.

A new viewpoint in JAMA Psychiatry acknowledges that legalization carries real risk but stops short of arguing for prohibition. Instead the authors recommend regulatory tools like marketing restrictions, accurate labeling, and potency limits to structure how cannabis markets operate.

Amee Norman joined Canadian cannabis extraction company Nextleaf Solutions as Director of Sales and Marketing. $OILS.CSE ( ▲ 14.29% )

Michigan operator Kenneth Gay petitioned the Supreme Court to overturn a Ninth Circuit ruling and decide whether states can favor in-state residents in cannabis licensing. The First, Second, and Ninth Circuits have split on whether the Dormant Commerce Clause applies to a federally illegal industry, and a recent CRS report said that split raises the odds the justices take the case.

An Eighth of Weed Costs $15 in Washington and $52 in Kentucky. The Reason Isn’t What You Think | High Times