Frankenstein Is Coming for Cannabis

Is your company ready?

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Early in the 1800s, from a dismal German laboratory, Victor Frankenstein created a creature using a mixture of surgery, chemistry, and alchemy – we will likely meet that monster in 2025.

The approach to cannabis legislation and policy is a Frankenstein approach, and is creating a similar monster. Of course, with the absence of a federal framework, we in the cannabis industry are used to operating across a patchwork of state laws and regulations, but this is new. As we launch into 2025, another patchwork of laws and regulations is evolving and will be combined, in ways yet to be seen, with the existing cannabis regulatory landscape.

To date, the federal government has failed to enact a framework for regulation of AI. Both state and federal legislators are rushing to fill the void, despite the risks in passing new laws. Over-regulation of AI could stifle innovation, while unregulated AI raises privacy concerns – along with other considerable risks.

States have been legislating about AI since at least 2019, but the number of bills relating to AI has exploded in the last two years. In 2024, U.S. lawmakers introduced almost 700 AI-related bills across 45 states. (By comparison, 191 were introduced in 2023.)

The results:

  • 113 were ultimately enacted into law.
  • 77 advanced through one chamber in statehouses.
  • Four legislatures (Nevada, Montana, North Dakota, and Texas) were not in session and could not consider legislation.
  • The only other state where legislation was not introduced was Arkansas. 

(Source: Business Software Alliance (www.bsa.org), the global trade association of the enterprise software industry.)

It is clear that 2025 will bring even more AI-related bills, creating an even thornier patchwork of bills for businesses to navigate. 

And it is only a matter of time before state regulators begin introducing bills that seek to regulate the use of AI specifically in the cannabis industry. The result will be a mega-monster: state-specific AI laws meshing with state-specific cannabis laws without any overarching unified policy principles or frameworks.

What can cannatech companies do to prepare for this monster?

The cannatech community should come together and align on model regulations and legislation that promote uniformity across states. The group can then develop an advocacy strategy. They can further promote the goals of cannatech companies operating in multiple states that have a huge stake in this, as well as companies with smaller reach that want to scale into a sensible framework. 

The cannabis industry has been adaptable by necessity since day one, but soon, the arrival of Frankenstein’s monster will test that adaptability in a way we haven’t seen before.

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