A measure to open up the banking system to cannabis companies now doing business in cash is receiving interim support from Senate Majority Leader Chuck Schumer.
The possible compromise on the Safe and Fair Enforcement Act (SAFE) could provide an increase in cannabis stocks, which have collectively lost about half of their value this year amid the dire prospects of legalization at the federal level.
“Sen. Schumer (who almost exclusively has the keys to passing SAFE’s banking reform bill) may be open to a reasonable and realistic commitment to approving SAFE, “Singer Fitzgerald analyst Pablo Zuanic said in a statement on Friday. “From a commercial and technical point of view, this could indicate the background for the group, despite questions about what SAFE could really achieve.”
The AdvisorShares Pure US Cannabis ETF MSOS,
-1.55%
it has fallen by 48.3% in 2022 and lost almost 68% of its value last year.
Schumer, a New York Democrat, has kept SAFE Banking in the background in the Senate as he works on drafting his own bill with fellow New Jersey Democrat Corey Booker and other lawmakers. Schumer recently said he plans to start his cannabis bill over the summer, later than initially expected.
Politico and Marijuana Moment reported Thursday that Schumer spoke with Rep. Dave Joyce, R., Ohio, about the possible combination of SAFE Banking with Joyce’s Exploitation of Opportunity Pursuit (HOPE) Act.
Too: Research firm sees possible approval of SAFE banking law on cannabis during lame duck session of Congress
Joyce mentioned the talk she had with Schumer on Thursday when she stopped at the International Cannabis Bar Association conference. Spokesmen for Schumer and Joyce confirmed that the meeting took place, Politico and Marijuana Moment reported.
A Joyce spokesman told Marijuana Moment that the conversation with Schumer was “part of a broader and ongoing discussion between both parties and chambers to determine what reform this Congress can approve.”
The SAFE Banking measure has won six times the approval of the US House of Representatives, but has yet to be voted on in the US Senate.
In the most recent attempt, House lawmakers attached the measure to America’s largest competing bill. The Senate’s version of the measure, called the Innovation Bill, is still under debate.
Singer Fitzgerald’s Zuanic said the talks between Joyce and Schumer could be a sign that “pressure / lobbying is beginning to be felt and that something could be approved this year.”
In the last check, the SAFE Banking measure had 42 sponsors in the U.S. Senate, including nine Republicans.
Seen as an intermediate measure that does not legalize cannabis at the federal level, SAFE Banking would allow banks with a federal charter to provide and provide financial services to companies that touch the plants and allow U.S. investment banks to provide services.
Community banks and some local banks have been providing some services to cannabis companies, but much of the legal multimillion-dollar cannabis industry to do their business in cash, which poses security risks to employees of thieves.
However, SAFE Banking, as it stands, would not potentially allow U.S. companies to directly trade their shares on the Nasdaq or the New York Stock Exchange, according to current interpretations.
Read below: Two cannabis CEOs praise US senators’ letter of support to SAFE Banking
