SAFE Act Gains More Support

More people are publicly warming to public and legal cannabis company funding.

The SAFE Banking Act of 2019, which would open banking to the cannabis industry, just gained 2 more cosponsors, making it only 43 shy of a majority. On the face of it, it seems like the ACT isn’t even close to getting enough support. But every vote counts here.

Despite a lack of lobbying by Wall Street and major banks, companies like PayPal are joining efforts and the SAFE Act is rapidly gaining cosponsors, where there may soon be enough support for a vote. The Senate also has their own version of the bill that was introduced in April.

If passed, this will significantly impact the industry and open up a ton of funding possibilities.  

Analysts at Cowen noted in a recent commentary that state banking trade groups are pressing Senate Banking Chairman Mike Crapo to hold a hearing on the SAFE Act, which would permit banks to service cannabis companies that comply with state law. The analysts believe this pressure will convince the chairman to hold the hearing, which should boost the prospect that the SAFE Act gets added to a broader legislative package such as a spending bill. This attachment can help get SAFE passed more easily.

“It is pressure like this which continues to convince us that the 116th Congress will enact cannabis legislation with narrower bills like the SAFE Act more probable than broader bills on legalization like the STATES Act,” they added.

Senators Elizabeth Warren (D-MA) and Cory Gardner (R-CO), along with Representatives David Joyce (R-OH) and Earl Blumenauer (D-OR), reintroduced The Strengthening the Tenth Amendment Through Entrusting States (STATES) Act of 2019. This Act amends the Controlled Substances Act to reduce the number of instances in which federal law enforcement agencies could carry out legal actions against state-licensed cannabis businesses or other related enterprises.