As legalization has spread across the country — 26 states and the District of Columbia have legalized recreational marijuana, and 38 now have medical marijuana programs — the illegal market has refused to disappear, instead reimagining itself by finding new regulatory loopholes to exploit. In Oregon, illegal operators posed as hemp farmers. In Oklahoma, illicit growers used the state's medical marijuana program as camouflage. And in New York City, a slow license rollout gave thousands of cannabis trucks and smoke shops time to claim space.
The cannabis market in the U.S. was worth an estimated $103 billion in 2023, according to Whitney Economics, which tracks the industry. But due to the unlicensed market's tenacity, just $31 billion of that came from legal shops. By 2026, the firm estimates that illegal sales will still account for 61 percent of the cannabis market.
States like California are now scrambling to figure out how to finally stop the seemingly never-ending reincarnation of illegal shops and cultivation facilities without reverting to the packed paddy wagons of old.
"What is the right way to drive accountability in this space from a penalty standpoint? ... I don't know that anyone has the right answer," Elliott said. "We're all trying to work through what that looks like now."
Read more at Politico.