This Analyst Makes The Case For Why There's Still Hope For A Cannabis Banking Reform Bill

The year 2022 has been challenging for the cannabis industry, to say the least, with stock prices plunging significantly. In the regulatory field, things have moved very little, at least on the federal level, following the historical introduction of the Cannabis Administration & Opportunity Act (CAOA) in July 2021.

The Biden Administration has been dodging marijuana decriminalization questions for months, and it seems he'll remain silent on the issue, at least until after the midterms.

Meanwhile, sponsors of the Secure and Fair Enforcement (SAFE) Banking Act, led by Sen. Jeff Merkley (D-OR), recently discussed the urgency of cannabis reform this session, reiterating the public safety imperative of providing the industry access to the traditional financial system.

The National Cannabis Industry Association (NCIA) recently brought together more than 100 stakeholders for two days of lobbying on Capitol Hill, which involved more than 100 meetings with legislators and staff to advocate for the measure to be enacted in 2022.

The banking reform bill, which the House passed for the sixth time in July as part of the National Defense Authorization Act, has never been voted on in the Senate.

SAFE Is Not Dead, Analyst Tells Us Why

However, “SAFE is not dead, contrary to what stocks may be implying,” Cantor Fitzgerald’s Pablo Zuanic said in his recent note.

The passage of the measure as part of a broader bill in the lame duck session is “the best-case scenario,” he added.

The analyst sees one of the CAOA leading sponsors, NJ's Senator Cory Booker, as the person who “holds the keys to SAFE being put up for a vote,” while he expects the final green light from Senator Mitchell McConnell.

“Conventional wisdom has it that Sen Booker has become a great supporter of the SAFE Banking Act due to its safety benefits and social equity benefits,” Zuanic said, adding that he “may also want to add other provisions.”

However, he sees Booker’s “restorative justice add-ons” as a deal breaker for Republicans, leading to not being able to garner the 60 necessary Senate votes for approval.

In order to get bipartisan support, the banking reform bill needs to be included in the defense bill (NDAA) alongside other measures such as HOPE and Cannabis Research, Zuanic said.

At the upcoming meeting with members of Congress, Zuanic hopes to get some answers on whether “SAFE in the lame duck” is just wishful thinking, the impact of the election outcome on the chances of SAFE passage and whether its success really comes down to two Senators. 

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