- Is CBD Legal? The Legal Status of CBD in 2020
- The Legality of Hemp versus Marijuana
- Is Hemp Derived CBD Legal?
- Is Marijuana-Derived CBD Legal?
- States Where Marijuana-Derived CBD is Legal for Recreational Use
- States Where Marijuana-Derived CBD is Legal for Medicinal Use
- States Where Marijuana-Derived CBD is Illegal
- Legal Status of CBD in the United States
- CBD Oil: What are 9 Proven or Possible Health Benefits?
- What is CBD?
- 1. Epilepsy
- 2. Pain
- 3. Arthritis
- 4. Anxiety
- 5. Depression
- 6. Sleep disorders
- 7. Acne
- 8. Parkinson’s Disease
- 9. Nausea and vomiting
- Other conditions
- Marijuana Stocks
- How to Invest in Marijuana Stocks
- But, Really, Should I Buy Marijuana Stocks?
- Marijuana Legalization in the U.S.: The History and the Future
- More Information on Canadian Marijuana Stocks
- Commonly Confused Cannabis Terms
Is CBD Legal? The Legal Status of CBD in 2020
Last year (2019) was filled with progress and accomplishments, but as 2020 is now well underway, the big question still remains amongst many individuals: Is CBD legal?
The short answer: Yes, CBD is legal, but… under very specific conditions.
While the legal status of CBD has become more defined with recent reforms, some laws are still unclear and others may still be needed. Combined with misinformation, many may have a very skewed understanding of what’s legal versus what isn’t.
If you’re unsure about the legality of CBD, read our 2020 guide to learn about the latest CBD laws and make sure you’re enjoying the benefits of CBD, safely and legally.
Is CBD legal in all 50 states? It depends.
The legality of CBD can vary from state to state and federally, but in general, one of the determining factors is whether the CBD is derived from hemp or marijuana.
While the two plants are very close relatives, they are classified very differently under the law and understanding the difference is crucial to legally use CBD.
The Legality of Hemp versus Marijuana
Hemp and marijuana are both terms used to describe different varieties of Cannabis and both can produce an abundance of CBD.
As members of the same family, hemp and marijuana share many visual similarities, but at a chemical level, the two plants have vastly different amounts of Tetrahydrocannabinol (THC), the intoxicating compound found in Cannabis.
While hemp is characterized by producing a nearly non-existent amount of THC (less than 0.3%), marijuana can produce an abundance of THC (up to 30%). Because of its high THC-content, marijuana may induce severe mind-altering effects when consumed and is federally illegal in the United States and many other countries.
Now that we’ve discussed the legality of the two primary sources of CBD, let’s explore the laws of CBD derived from hemp versus CBD derived from marijuana, and how the laws vary from state to state.
Is Hemp Derived CBD Legal?
Quick answer: Hemp-derived CBD is legal as long as it is produced within the regulations defined by the law.
In 2018, President Trump passed the Agricultural Improvement Act of 2018 (also known as the 2018 Farm Bill), which removed hemp as a Schedule I substance and reclassified it as an “agricultural commodity.”
A common misconception about the 2018 Farm Bill is that it legalized CBD regardless of if it was derived from hemp or marijuana. This is not true.
the guidance of the DEA, CBD is a Schedule I substance and is illegal.
If, however, the CBD is derived from hemp and adheres to the following regulations set forth in the new farm bill, it is removed as a Schedule I substance and is legal:
- The hemp must contain less than 0.3% THC
- The hemp must adhere to the shared state-federal regulations
- The hemp must be grown by a properly licensed grower
In addition, the 2018 Farm Bill also removed restrictions on the sale, transportation, and possession of hemp-derived CBD products and allowed for the transportation of hemp-derived CBD products across state lines as long as the products follow regulations defined above.
Is Marijuana-Derived CBD Legal?
While hemp-derived CBD is federally legal, as long as it adheres to the law, marijuana-derived CBD is a bit more complicated because it is derived from a plant that is illegal.
In some states, such as California and Colorado, marijuana is legal for recreational usage, and naturally so is marijuana-derived CBD. Others allow marijuana-derived CBD usage under certain conditions, such as a specific medical condition, and some states strictly prohibit it.
Continue below for a detailed list of which states allow marijuana-derived CBD for recreational use or medicinal use, and the states that strictly prohibit it.
States Where Marijuana-Derived CBD is Legal for Recreational Use
As of 2020, there are 10 States where Cannabis, including both marijuana and hemp, are completely legal for recreational and medicinal use. These states are Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington. If you find yourself in one of these wonderful states, you would be completely within your legal rights to use CBD.
In any case, we still strongly recommend consulting with your doctor or a certified health professional to ensure CBD is safe for you to use.
States Where Marijuana-Derived CBD is Legal for Medicinal Use
As of 2020, there are a total of 47 states (including the 8 states mentioned above) where marijuana-derived CBD is legal for medicinal usage.
The specific regulations for such use vary from state to state with a majority of states allowing medicinal use for a broad range of conditions, while others set specific requirements for approved use (ie, the CBD must contain less than a certain percentage of THC or the patient suffers from a specific condition).
States with regulations that permit the use of marijuana-derived CBD for a broad range of conditions include Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, Vermont, Washington and West Virginia.
States with regulations that permit the use of marijuana-derived CBD under certain circumstances include Alabama, Georgia, Indiana, Iowa, Kentucky, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Utah, Virginia, Wisconsin, and Wyoming.
Please note that the regulations for a majority, if not all, of these states, do require patients to obtain a medical marijuana card in order to legally consume marijuana-derived CBD. The requirements to obtain a medical marijuana card in each of these states will vary depending on the regulations of each state.
For further information about the specific regulations for each state, you can locate the latest legislation for each state by using our CBD law finder at the bottom of this page.
The specific requirements for an individual to use marijuana-derived CBD will vary from state to state. Before purchasing CBD in any of these states, we highly advise you to do additional research and consult a lawyer if necessary. Use our easy CBD law finder below to review the latest legislation that we have gathered for each state.
States Where Marijuana-Derived CBD is Illegal
Both hemp-derived and marijuana-derived CBD are legal at varying levels in a majority of the United States; however, there are certain states where marijuana-derived CBD is strictly prohibited and even hemp-derived CBD is a bit of a gray area. There are currently three (3) states that have taken a strong stance against CBD in the US: Idaho, Nebraska, and South Dakota.
If you live in one of these states, it is highly advised to proceed with extreme caution. While some businesses do sell CBD products in these states, the sale, possession, or use of CBD is very risky.
Legal Status of CBD in the United States
We are not lawyers and the information above should in no way be interpreted as professional advice or legal counsel.
The information provided in this table is independent research and, although we will try to update it as often as possible, the information may not always be accurate.
If you notice that any of the information above is date, please notify us in the comments section below and we can update the information accordingly.
Legal Disclaimer: The information contained on this page is based entirely on independent research. While our team strives to provide the most accurate and current information by carefully reviewing relevant data from actual legislation and other credible resources, we are not lawyers or legal experts and this information should not be interpreted as legal advice.
The information on this page was created to entertain and engage our readers and should not be used for any other purpose. For your safety, protection, and well-being, we strongly advise that you do not use this information to make any decision or take any action and strongly encourage you to seek legal counsel before taking any action related to Cannabidiol (CBD).
CBD Oil: What are 9 Proven or Possible Health Benefits?
With a forecasted revenue of over 20 billion by 2024, the CBD market is booming.1 But what exactly is CBD and how effective is it? We look at 9 proven or possible health benefits of CBD oil.
What is CBD?
CBD (short for cannabidiol) is one of over 200 chemical compounds known as cannabinoids that are found in cannabis. It is the second most prevalent active compound found in cannabis, behind THC (tetrahydrocannabinol), which is the compound in cannabis that has psychoactive properties and gives people a high.2
Cannabis is a plant, and there are two main types, Cannabis Indica and Cannabis Sativa. Both marijuana and CBD can be derived from both types, but hemp is only derived from Cannabis Sativa. By law, hemp must contain no more than 0.
3% THC (the oil in marijuana that gives you a high) to be called hemp, otherwise, growers are at risk of prosecution under federal law.
Hemp is a great resource for making 100% biodegradable, environmentally friendly products such as clothing, packaging, biofuel, building materials, and paper.
CBD derived from hemp contains no more than 0.3% THC and is legal federally but still illegal under some state laws. Cannabis-derived CBD products, on the other hand, are illegal federally but legal under some state laws.
Un THC, CBD has no psychoactive properties and will not give you a “high”. There is no evidence it has any abuse or dependence potential and to date, there is no evidence that it is associated with any serious side effects, according to the World Health Organization.
Instead, CBD has been credited with relieving numerous medical conditions, such as epilepsy, anxiety, inflammation, insomnia, and pain. Although “credited” does not mean proven. Because of the historical regulatory landscape, there are hardly any well-conducted trials backing up those claims, although research is expected to ramp up now that laws distinguish between hemp and marijuana.
We look at nine medical conditions where CBD may be, or, has already proven to be, beneficial.
In June 2018, the FDA approved Epidiolex (a plant-based formulation of CBD) to treat seizures for people 2 years of age and older with Dravet syndrome and Lennox-Gastaut syndrome (LGS), which are two rare forms of epilepsy.
CBD has also been investigated for use in other forms of treatment-resistant epilepsy, usually in addition to conventional epilepsy medications. Results varied, but several trials showed CBD significantly reduced seizure frequency by almost 44% in most people.3
CBD can interact with other medications used for epilepsy and some serious side effects have been reported, notably, a decrease in liver function when given to people already taking valproate.
Conclusion: CBD is beneficial for treating certain types of epilepsy.
Animal studies have shown that CBD has anti-inflammatory effects and works on the endocannabinoid and pain-sensing systems to relieve pain.
Unfortunately, few human trials investigating the use of CBD as a single agent to relieve pain exist, with most trials using a combination of CBD and THC to relieve pain.
Notably, Health Canada has approved a combination medication that contains both THC and CBD in a 1:1 ratio for the relief of central nerve-related pain in multiple sclerosis, and cancer pain that is unresponsive to optimized opioid therapy.
An observational study of CBD treatment reported an improvement in self-reported quality of life measures for people with non-cancer-related pain but there was no statistically significant improvement in those with cancer-related pain or with neurological symptoms.8
A case series of 47 people with multiple sclerosis reported improvements in pain, walking, and muscle spasms with a combination of CBD and THC. 15
Animal studies have shown that CBD has a positive effect on serotonin levels in the brain, and serotonin. Low levels of serotonin are thought to play a key role in mood as well as pain.11
Other research (both animal and human) has shown that CBD has anti-inflammatory effects, and it may relieve pain by this mechanism.
CBD can interact with other medications used to treat heart conditions or immunosuppressants so you should always talk with your doctor before taking CBD.
Conclusion: CBD may be beneficial at relieving pain but no high-quality human studies prove this.
Animal studies showed that topical CBD applications relieve pain and inflammation associated with arthritis with few side effects. The topical application of CBD is beneficial because CBD is poorly absorbed when taken by mouth and can cause gastrointestinal side effects. 6
Conclusion: Topical CBD may be beneficial at relieving arthritis but no high-quality human studies prove this.
Pretreatment with 300mg CBD significantly relieved anxiety in 57 healthy males who undertook a simulated public speaking test. However, dosages of 150mg CBD and 600mg CBD did not make any difference to the men’s anxiety levels.7
Beneficial effects on anxiety after taking CBD were reported in an observational study where 21 patients 400 had anxiety. 8
Anxiety scores decreased in a large case series of 72 patients, with 57 patients (79.2%) reporting decreased scores within the first month after CBD treatment. 9
Conclusion: CBD may relieve anxiety before events such as public speaking but it is not known what the optimal dose is.
Animal studies have shown some effect of CBD at relieving depression, possibly related to its strong anti-stress effect after either acute or repeated administration.16
Animal studies have shown that CBD has a positive effect on serotonin levels in the brain, and serotonin. Low levels of serotonin are thought to play a key role in mood as well as pain.11
Conclusion: CBD may help with depression but more trials are needed.
6. Sleep disorders
31% of people taking CBD for other conditions such as anxiety or non-cancer-related pain reported improved sleep with CBD.8
In a large case series of 72 people, 48 patients (66.7%) reported an improvement in sleep scores within the first month, but these fluctuated over time.9
Other trials of 300 mg of CBD in people with anxiety or depression showed that CBD appeared to preserve sleep architecture, meaning it was unly to have any negative effects on sleep quality.10
Conclusion: CBD does not appear to interfere with sleep and may help people sleep better.
A laboratory study found that CBD prevented human sebocytes from creating too much sebum in addition to having an anti-inflammatory effect, preventing inflammatory cytokines from activating. Because excessive sebum and inflammation are characteristic of acne, topical CBD could be an effective treatment for acne and may prevent or reduce future breakouts.12,13
Conclusion: Topical CBD may help relieve inflammation and excessive sebum production associated with acne but more trials are needed.
8. Parkinson’s Disease
Several smalls studies have investigated using CBD to relieve symptoms of Parkinson’s Disease, with mostly encouraging results.
For most studies, there were no differences across groups with regards to movement-related outcomes; however, groups treated with CBD 300 mg/day had a significantly improved well-being and quality of life as measured by the Parkinson’s Disease Questionnaire [PDQ-39]).15
Conclusion: CBD shows promise for improving the quality of life in people with Parkinson’s disease but larger trials are needed.
9. Nausea and vomiting
Most studies investigating if CBD is beneficial at relieving nausea or vomiting, have used a combination of CBD and THC, rather than just CBD alone. A 2016 review found the combination to be either more effective or as effective as a placebo.14
More recent research points to THC being more effective at reducing nausea and vomiting than CBD.
Conclusion: CBD is unly to be effective by itself for nausea and vomiting. The combination of THC and CBD does seem to be effective for nausea and vomiting.
Many other studies, both on animals and humans, have overwhelmingly concluded that CBD has immunosuppressive and anti-inflammatory properties which may make it a good choice for some autoimmune conditions or inflammation-related complaints.16
In addition, more trials are needed to investigate its use for numerous other conditions, such as muscle-spasticity in multiple sclerosis, Alzheimer’s disease, substance-abuse treatment, and diabetes protection.
Side effects of CBD may include nausea, tiredness, and irritability, and it may interact with some medications, such as warfarin.
The marijuana industry is expected to triple in the next five years — and many investors are looking to profit.
As states and entire countries decriminalize or legalize cannabis and/or its components, there are loads of opportunities for entrepreneurs and existing companies.
But as in any nascent industry, there are also loads of risks and bad actors. Whether you're a first-time investor or a seasoned veteran, it pays to understand all of the moving parts.
This guide will get you up to speed quickly.
How to Invest in Marijuana Stocks
Follow these seven steps if you're thinking about buying cannabis stocks. The following is a summary, but we encourage you to read the entire article linked below for all the details.
1. Understand the types of marijuana products.
- There are two types of cannabis products: medical marijuana vs. recreational marijuana.
- Cannabidiol (CBD) is a cannabinoid that is different than the psychoactive delta-9 tetrahydrocannabinol (THC).
2. Know the different types of marijuana stocks.
- Marijuana growers Canopy Growth Corporation (NYSE:CGC)
- Cannabis-focused biotechs GW Pharmaceuticals (NASDAQ:GWPH)
- Providers of supporting products and services Scotts Miracle-Gro (NYSE:SMG)
3. Understand the risks of investing in marijuana stocks.
- Legal and political risks
- Supply/demand imbalances
- Risk in those that are over-the-counter stocks
4. Know what to look for in a marijuana stock.
- Normal stock considerations, including:
- Management team
- Growth strategy
- Competitive position
- Financials (ideally either profitability or strong balance sheet)
- Cannabis production costs
- “All-in” cost of sales per gram
- Cash cost per gram
- For Canadian companies, the extent of international operations and distribution
- Dilution risks via warrants and convertible securities
5. Evaluate the top marijuana stocks and exchange-traded funds (ETFs).
6. Invest carefully.
- For many, avoiding individual investments in the marijuana space entirely is the right call.
- For those who buy in, keeping your marijuana exposure to a small percentage of your overall portfolio limits your risk.
- Pure plays are riskier than more diversified plays.
7. Monitor changing industry dynamics closely.
- Laws, regulations, competitive forces, and the business strategies of the companies themselves will all change rapidly over time.
Read more: How to Invest in Marijuana Stocks (Note: includes a list of every major marijuana stock)
But, Really, Should I Buy Marijuana Stocks?
We just went step-by-step through how to invest in cannabis, but just because there's a trendy new sector with lots of press and potential growth doesn't mean you need to put your hard-earned money in it. After all, if you buy broad index funds, you're covered no matter what sector of the stock market does well.
Think through the pros and cons as you read on: Should You Invest in Marijuana Stocks?
Marijuana Legalization in the U.S.: The History and the Future
One of the biggest variables in cannabis investing is to what extent marijuana will be decriminalized or legalized within the United States, both on a state-by-state basis and on a federal basis.
The link below provides a quick spin through what we've seen so far, from decriminalization efforts starting in 1973 to legalization efforts beginning in earnest in 1996 to the political signs of where we seem to be heading.
Read on: Timeline for Marijuana Legalization in the United States: How the Dominoes Are Falling
More Information on Canadian Marijuana Stocks
There's been tremendous interest in Canadian cannabis stocks, because on October 17, 2018, recreational use of marijuana became legal in Canada (it had been legalized on a medical basis since 2001).
Beyond consumption by Canadians, the upside thesis involves operations or distribution to other countries that have legalized or may legalize marijuana to various extents. This includes Germany and particularly the large market on Canada's southern border.
Read on: Everything You Need to Know About Investing in Canadian Marijuana Stocks
Commonly Confused Cannabis Terms
One of the difficulties in understanding the marijuana industry is the jargon. Fortunately, it's not too complicated once you get a handle on a few main terms.
Marijuana vs. cannabis
Cannabis is the scientific name of the plant (the genus that houses three species). For an investor's purposes, marijuana is synonymous with cannabis, as are more informal nicknames pot, weed, ganja, dope, grass, 420, sticky icky, etc.
CBD vs. THC
Cannabis is made up of nearly 500 chemical constituents, including many dozens of cannabinoids (substances that act on the body's cannabinoid receptors).
The two most commercially relevant of these cannabinoids are delta-9 tetrahydrocannabinol (THC) and cannabidiol (CBD). Only THC is psychoactive (i.e., makes you high).
Hemp is a strain of a species of cannabis with relatively low levels of THC and relatively high levels of CBD. It has many industrial uses providing fibers to make rope and clothing.
Eric Volkman | Mar 25, 2021
Collectively, analysts were looking for a net profit instead of the $24 million-plus loss the company announced.
Eric Volkman | Mar 25, 2021
The Empire State will become the 16th to sanction adult-use cannabis.
Keith Speights | Mar 25, 2021
The cannabis company's top line continued to improve in the fourth quarter.
Jeff Little | Mar 25, 2021
Sights are set on a new kind of California gold rush.
David Jagielski | Mar 25, 2021
Both of these cannabis stocks have risen more than 400% in the past year, and they aren't done growing.
Billy Duberstein | Mar 24, 2021
Time for investors to take advantage?
Keith Speights | Mar 24, 2021
It's an easy choice.
David Jagielski | Mar 24, 2021
Multiple high-profile companies may still be on the hunt for a deal.
Eric Volkman | Mar 23, 2021
A seemingly positive development on the legislative front for the industry wasn't greeted too warmly by investors.
Eric Volkman | Mar 23, 2021
Net profit wasn't nearly as high as it was in previous periods.
Keith Speights | Mar 23, 2021
The multistate cannabis operator still largely relied on one state for its success.
Jeff Little | Mar 23, 2021
Getting in on the growth of the marijuana industry doesn't have to be stressful.
Howard Smith | Mar 23, 2021
Investors are looking forward to the upcoming vote for its merger with Aphria.
Sushree Mohanty | Mar 23, 2021
Consider these few things first.
David Jagielski | Mar 23, 2021
And a multistate operator Curaleaf could be a big winner when that happens.
Rich Duprey | Mar 22, 2021
The marijuana producer promises updates on the agreements in the coming months.
Alex Carchidi | Mar 21, 2021
What's not to love about skyrocketing revenue and earnings?
Zhiyuan Sun | Mar 21, 2021
Looking for marijuana stocks? Here's a pot grower that's been making several exciting acquisitions this year.
Sushree Mohanty | Mar 20, 2021
The cannabis sector has a lot of upside potential, and these three U.S. operators in particular should benefit.
Eric Volkman | Mar 19, 2021
The company posted a nearly $17 million net loss for the period.
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