Odds On: Traders on Kalshi see 4% chance of cannabis rescheduling this month

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BACKGROUND: The U.S. federal government is expected to reclassify cannabis under the Controlled Substances Act. Currently, cannabis is classified as a Schedule I drug, the most restrictive category, meaning it’s treated as having a high potential for abuse, no accepted medical use, and strict legal penalties. The proposed change would move marijuana to Schedule III, a less restrictive category that includes substances recognized to have legitimate medical uses and lower abuse potential. This idea has been in motion for over a year and stems from past federal reviews of cannabis’s medical and abuse profiles. The Washington Post reported earlier in the week that President Trump has discussed the plan with House Speaker Mike Johnson and is expected to aim to broaden access to the drug through an upcoming executive order that directs federal agencies to pursue reclassification. Additionally, CNBC noted an executive order is seen as coming as soon as Monday.

THE BET: Polymarket offers the two markets of “Weed rescheduled in 2025?” with a total volume of $139,140 and “Weed rescheduled by March 31?” with a total volume of $6,241. Traders on Polymarket are pricing in a 5% chance of the cannabis being rescheduled in 2025. The “Yes” contract was last trading at 6c, while the “No” contract stood at 96.5c. Market participants on Polymarket are pricing in a 38% chance of cannabis being rescheduled by March 31, 2026. The “Yes” contract was last trading at 39c, while the “No” contract stood at 63c.

Meanwhile on Kalshi, the prop is titled “Will Marijuana be Rescheduled?” with a total volume of $775,181. Kalshi offers four possibilities. Traders on Kalshi are pricing in a 4% chance of the cannabis being rescheduled before 2026. The “Yes” side last traded at 6c, and the “No” contract is sitting at 95c. Traders on Kalshi are pricing in a 81% chance of cannabis being rescheduled before 2027. The latest trade shows the “Yes” contract at 81c and the “No” at 20c. Traders on Kalshi are pricing in a 80% chance of cannabis being rescheduled before 2028. The “Yes” contract was most recently at 86c, compared with the “No” at 19c. Lastly, Traders on Kalshi are pricing in a 89% chance of cannabis being rescheduled before 2029. The last trade saw the “Yes” contract at 89c, while the “No” contract settled at 19c.

THE RULES: According to Polymarket, this market will resolve to “Yes” if marijuana is rescheduled down from I to any other level, or is unscheduled completely, by the Drug Enforcement Agency of the United States. Otherwise, this market will resolve to “No”.

Kalshi noted if the DEA were to reschedule only certain cannabis derivatives or specific cannabinoids (e.g., move THC or a particular cannabis-derived pharmaceutical to a different schedule) without reclassifying marijuana/cannabis as a whole, that would not qualify as rescheduling marijuana for this contract. Ending the schedule altogether would resolve the market to Yes.

CANNABIS NAMES: Publicly traded companies in the cannabis space include Aurora Cannabis (ACB), CV Sciences (CVSI), Canopy Growth (CGC), Cronos Group (CRON), Goodness Growth (GDNSF), Green Thumb Industries (GTBIF), IGC Pharma (IGC), Tilray (TLRY), Trees Corporation (CANN) and Trulieve Cannabis (TCNNF).