The North American cannabis industry is booming amid increased legalization, with merger and acquisition activity soaring and new deals being announced almost daily. While the industry is clearly still in its growth stage, more legalization of cannabis foretells increased competition followed by industry consolidation, shakeout and a movement toward industry maturity—as is the case with most every consumer product industry.
As the industry continues to progress through its growth stage, cannabis-related companies will increasingly seek additional capital through public transactions, in response to competitive forces and persisting investor demand. Many self-appointed investment gurus feel that the industry is currently a once-in-a-lifetime growth opportunity, and every investor seems to want a piece of the action. But, despite all the recent success stories stemming from expanding cannabis legalization in Canada and the United States, why does it feel as though investment options are still very limited? The answer lies in the current U.S. federal law and banking regulations, which severely limit opportunities for cannabis investment on major stock exchanges.
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